US Core Inflation Holds Steady Ahead of Warsh Speech

The US Bureau of Economic Analysis reported that the PCE price index rose by 0.2% in July, keeping the annual rate at 3.3%. This measure of underlying inflation is closely watched by the Federal Reserve as it sets monetary policy.

Consumer spending was relatively flat, increasing by just $36.3 billion (or 0.2%) last month. The result aligns with economists' expectations, which were based on previously released data.

The report comes ahead of a speech by Kevin Warsh at the Jackson Hole monetary policy conference, where he will likely discuss interest rates and inflation targets. Some Fed officials have argued that inflation has been above target for too long and hikes are needed to bring it back down to 2%.