The same index excluding food and energy. The Fed watches core PCE most closely because it shows where underlying inflation is settling; the BEA release gives both.

Why does PCE differ from CPI?

Different weights and a formula that allows substitution. Shelter is about a third of CPI and half that in PCE, which is the main reason PCE runs lower.

US PCE Inflation (year over year)

3.7%

+21 bp vs Aug

As of Sep 2026 · Updated monthly · Source: BEA Personal Consumption Expenditures price index, seasonally adjusted, via FRED; year-over-year change computed by MarketIntelLabs

US PCE Inflation (year over year)Sep 1, 2021 to Sep 1, 2026

3.4%

Aug 2026

One year ago

2.8%

+87 bp since

52-week high

3.8%

May 2026

52-week low

2.7%

Oct 2025

Recent readings

Date	PCE YoY	Change
Sep 2026	3.7%	+21 bp
Aug 2026	3.4%	+7 bp
Jul 2026	3.4%	−8 bp
Jun 2026	3.5%	−37 bp
May 2026	3.8%	+25 bp
Apr 2026	3.6%	+20 bp
Mar 2026	3.4%	+57 bp
Feb 2026	2.8%	+7 bp
Jan 2026	2.7%	−5 bp
Dec 2025	2.8%	+7 bp
Nov 2025	2.7%	+5 bp
Oct 2025	2.7%	−12 bp

Most recent first; change is versus the prior reading shown. Source: BEA Personal Consumption Expenditures price index, seasonally adjusted, via FRED; year-over-year change computed by MarketIntelLabs.

What this number is

The year-over-year change in the Personal Consumption Expenditures price index from the Bureau of Economic Analysis, published near the end of each month for the month before.

Why it matters

This, not CPI, is the measure the Fed's 2% target refers to. It weights spending differently (less housing, more health care) and lets the basket shift as people substitute, so it usually runs a few tenths below CPI.

Questions readers ask

What is core PCE?: The same index excluding food and energy. The Fed watches core PCE most closely because it shows where underlying inflation is settling; the BEA release gives both.
Why does PCE differ from CPI?: Different weights and a formula that allows substitution. Shelter is about a third of CPI and half that in PCE, which is the main reason PCE runs lower.

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