Yahoo Finance Live anchors Julie Hyman and Ines Ferre discuss the rise in core PCE and what it means for the Fed ahead of the next FOMC meeting.

Video Transcript

JULIE HYMAN: Well, we've got to turn now to what's going on with inflation readings, which we got this morning. The Personal Consumption Expenditures, or what they called PCE-- as we talk about frequently, this is the Fed's preferred measure of inflation. And we're going to get you more of an explainer later on as to why the Fed likes this measure and how it's different from CPI.

But let's talk about the numbers first. 0.3% was the increase that we saw in PCE on a month-over-month basis, right? That's on the core level. And that is 4.6% if you look at the year-over-year.

0.3% was also the change the prior month. That was down from about a half to 0.6%. So it is a slowdown from what we saw a couple of months ago but on the core level, Ines, didn't budge for the second month in a row.

INES FERRE: Yeah, that's right. And this is, as you mentioned, the Fed's-- one of the Fed's gauges, preferred gauges for inflation. And so what it's basically saying is that inflation is still stubbornly high and that perhaps the Fed has more to do, more in this fight against inflation.