US PCE Prices Edge Up 0.2%, Meeting Expectations

The US PCE price index rose 0.4% month-over-month in December 2025, following a 0.2% increase in November, the most since February and above market expectations of 0.3%. Prices for goods were up 0.4%, accelerating from 0.1% in November while prices of services rose at a faster 0.3%, compared with 0.2% in November. Core PCE, which excludes food and energy, increased 0.4%, also above forecasts of 0.3%. Separately, prices for food rose 0.4% and cost for energy goods and services went up 0.2%, easing from a 1.7% rise. On an annual basis, headline PCE inflation accelerated to 2.9% from 2.8%, above forecasts of 2.8%. Core PCE inflation also edged up to 3% from 2.8% in November and above expectations of 2.9%. The PCE index remains the Federal Reserve’s preferred inflation gauge.

The US PCE price index is expected to rise 0.3% month over month in December 2025, while the core PCE index which excludes food and energy, is also forecast to increase by 0.3%, compared with gains of 0.2% in November. On a year-on-year basis, the PCE inflation likely steadied at 2.8% while the core rate is seen edging higher to 2.9% from 2.8%. The PCE price index, the Federal Reserve’s preferred measure of inflation, is expected to show in its December report that progress in bringing inflation down has slowed, with price pressures remaining stubbornly above the Fed’s 2% target.

The US PCE price index rose 0.2% month-over-month in November 2025, the same as in October and in line with expectations. Prices for goods were up 0.2%, rebounding from a 0.1% fall in October while prices of services rose at a slower 0.2%, compared to 0.3% in October. Core PCE, which excludes food and energy, increased 0.2%, also the same as in September and matching forecasts. Separately, prices for food stalled and cost for energy goods and services soared 1.9%, after a 0.7% rise drop. On an annual basis, headline PCE inflation accelerated to 2.8% from 2.7% as expected. Core PCE inflation also edged up to 2.8% from 2.7% in October and in line with expectations. The PCE index remains the Federal Reserve’s preferred inflation gauge.