Consumer prices in the U.S. increased slightly in June, aligning with economists' forecasts, according to a report released by the Commerce Department on Friday.
The Commerce Department's personal consumption expenditures (PCE) price index rose by 0.1 percent in June following no change in May, meeting expectations.
The report also indicated that the annual growth rate of the PCE price index slowed to 2.5 percent in June from 2.6 percent in May, consistent with predictions.
Additionally, the core PCE price index, which excludes food and energy prices, increased by 0.2 percent in June after a 0.1 percent climb in May. Economists had predicted a 0.1 percent increase.
The annual growth rate of the core PCE price index remained steady at 2.6 percent in June, while economists anticipated a deceleration to 2.5 percent.
"The moderate increase in prices will bolster the Federal Reserve's confidence that inflation is on a trajectory toward its 2% target," said Michael Pearce, Deputy Chief U.S. Economist at Oxford Economics. "Although we don't expect the outlook to remain as favorable in the coming months, a significant upward surprise in inflation between now and September would be required to deter the Fed from cutting rates at that meeting."
These inflation metrics, which are favored by the Federal Reserve, were included in the Commerce Department's report on personal income and spending.
The report stated that personal income inched up by 0.2 percent in June after a downwardly revised 0.4 percent increase in May. Economists had anticipated a 0.4 percent rise, compared to the initially reported 0.5 percent increase for May.
Disposable personal income, or personal income less personal current taxes, also rose by 0.2 percent in June after a 0.4 percent rise in May.
According to the Commerce Department, personal spending grew by 0.3 percent in June following an upwardly revised 0.4 percent increase in May. Economists had expected a 0.3 percent increase in personal spending, compared to the originally reported 0.2 percent rise for May.
Excluding price changes, personal spending edged up by 0.2 percent in June after a 0.4 percent climb in May.
As spending outpaced income slightly, personal saving as a percentage of disposable personal income decreased to 3.4 percent in June from 3.5 percent in May.
