Inflation Edges Closer to Fed's Target as Core Rates Remain Stubborn

The latest data shows overall inflation nearing the Federal Reserve's 2% goal, though core inflation remains elevated, impacting future interest rate decisions.

The personal consumption expenditures (PCE) price index rose 2.1% year-over-year in September, the lowest since early 2021, but core PCE remained steady at 2.7%.
Core PCE inflation, excluding food and energy, saw its largest monthly increase since April, rising 0.3% from August.
Economists suggest the data reflects a 'soft landing' scenario, with robust consumer spending and stable economic growth.
The Federal Reserve's future interest rate cuts may be gradual, as core inflation's persistence indicates a cautious approach.
The economic outlook is influenced by the upcoming presidential election, with potential volatility in consumer sentiment anticipated.