Fed’s Preferred Inflation Gauge Drops for First Time Since 2020

The first monthly drop in the PCE since the coronavirus pandemic.

A man shops at a grocery store in Houston, Texas, on Dec. 18, 2022. Brandon Bell/Getty Images

The Federal Reserve’s preferred inflation gauge slowed at a better-than-expected pace in November as price pressures continued to subside heading into 2024.

Last month, the annual personal consumption expenditure (PCE) price index eased to 2.6 percent, down from 2.9 percent in October, the lowest reading since February 2021. This also came in below the consensus estimate of 2.8 percent.