- The Federal Reserve’s preferred inflation gauge is on track to show its smallest monthly increase since late last year, a starting point for officials to begin cutting interest rates, as soon as September.
- Economists expect no change in the personal consumption expenditures price index for May and a slight increase of 0.1% in the core measure that excludes food and energy, based on the median forecast in a Bloomberg survey.
- The report, due out on Friday, is also expected to show an annual increase of 2.6% in all broad and core measures, and the expected increase in the core measure, which paints a better picture of underlying inflation, would still be the smallest since March 2021.
- Since their last meeting, Fed officials have said that while the decline in other inflation data, including the consumer price index, has been encouraging, they need to see that progress continue for months before cutting interest rates.
