The US PCE price index rose 0.4% month-over-month in December 2025, up from a 0.2% increase in November. This was the largest monthly gain since February and exceeded market expectations of a 0.3% rise. Goods prices advanced 0.4%, accelerating from 0.1% in November, while services prices increased 0.3%, compared with 0.2% in the prior month.
Core PCE— which excludes food and energy—also climbed 0.4%, surpassing consensus forecasts of 0.3%. Food prices rose 0.4%, and the cost of energy goods and services increased 0.2%, a notable slowdown from the previous 1.7% gain.
On a year-over-year basis, headline PCE inflation quickened to 2.9% from 2.8%, coming in above expectations of 2.8%. Core PCE inflation edged up to 3.0%, from 2.8% in November, also topping forecasts of 2.9%. The PCE index remains the Federal Reserve’s preferred measure of inflation.
