Fed's Favored Inflation Gauge Likely Moderated in June

Dow Jones07-15 23:21

The inflation metric tracked by the Federal Reserve likely cooled last month, which could bolster the central bank's case for holding rates steady in July.

The official June number from the Commerce Department won't be available until later this month. But based on numbers from this week's cool consumer- and wholesale-inflation data, many economists are forecasting that excluding food and energy costs, the price index of personal-consumption expenditures rose by less than 0.2% last month.

That would likely bring the core PCE inflation rate down to 3.3% in June, versus 3.4% in May. As they peruse the past two days' inflation numbers, traders are paring their bets on the likelihood of a rate increase at the Fed's next meeting in two weeks.

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