U.S. Fed's Inflation Measure Posts Biggest Year-over-year Increase Since Early 1990s

A key U.S. inflation measure closely watched by the Federal Reserve in October posted its biggest year-over-year increase since the early 1990s amid supply chain bottlenecks, the U.S. Commerce Department reported Wednesda

WASHINGTON, Nov. 24 (APP - UrduPoint / Pakistan Point News - 25th Nov, 2021 ) --:A key U.S. inflation measure closely watched by the Federal Reserve in October posted its biggest year-over-year increase since the early 1990s amid supply chain bottlenecks, the U.S. Commerce Department reported Wednesday.

The personal consumption expenditure (PCE) price index, the Fed's preferred inflation measure, jumped 5 percent in October from a year ago, the fastest annual pace since November 1990, according to the department.

The so-called core PCE price index that strips out volatile food and energy prices, rose 4.1 percent from a year ago, the fastest gain since January 1991, well above the Fed's inflation target of 2 percent.

"The record-high PCE deflator numbers will add to the pressure on the Fed as the market is pricing in a faster pace of tapering and an earlier start to rate hikes next year," Tuan Nguyen, U.S.