US Core PCE Inflation Gauge Posts Muted Advance

A closely watched US price gauge, known as the core personal consumption expenditures (PCE) index, rose by 0.2% from a month earlier in July and 3.3% from a year earlier.

The PCE index excludes food and energy items and is used to track inflation. The muted advance gives the Federal Reserve room to hold interest rates steady in the near term.

Inflation-adjusted consumer spending was flat last month following strong increases in May and June, suggesting that growth may be slowing down.