Key inflation indicator up 3.5% year over year in June for fastest gain since 1991

An inflation indicator that the Federal reserve uses as its key guide rose 3.5% in June, a sharp acceleration that was nonetheless right around Wall Street expectations, the Commerce Department reported Friday.

The personal consumption expenditures price index excluding food and energy was expected to increase 3.6% at a time when the U.S. economy has seen higher inflation pressures than it has seen in more than a decade.

That gain was slightly ahead of the 3.4% May increase and represents the biggest move since July 1991.

Fed officials have said they expect the inflation surge to be temporary as it has come largely from industries sensitive to the economic reopening, as well supply chain bottlenecks and other issues likely to fade.

The core PCE index rose 0.4% month over month, which was below the 0.6% Dow Jones estimate, indicating that inflationary pressures may be starting to ebb at least a bit.

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