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Economy

US PCE inflation: 3.4% annual rate in August, below forecasts but above target

The Fed's preferred inflation gauge rose 0.3% in August and 3.4% over the year, below economist forecasts. Outlets differ on whether that is a dip or little easing.

5 outlets · 1L · 2C · 2R First reported Account updated

Updated (version 3). Rewritten with the latest reporting. Previously: “US PCE inflation: 3.4% annual rate in August, below forecasts but still above target”.

Image: The New York Times
Image: The Hill
Image: Just the News
Image: Breitbart

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The story, neutrally told

The Commerce Department reported on Wednesday 30 September that the personal consumption expenditures (PCE) price index rose 0.3% in August from July. The annual rate was 3.4%. Excluding food and energy, core PCE rose 0.2% on the month and 3.0% on the year.

Breitbart and Hindustan Times say the readings were below expectations. Breitbart cites forecasts of 3.7% annually and 0.4% monthly; Just the News, citing CNBC, gives 0.3% for the month and 3.7% for the year. Breitbart says July's figures were revised down after annual methodology changes by the Bureau of Economic Analysis, and that energy was the main driver in August, with gasoline up 4.4%. The Hill calls the result a dip, while the New York Times says it showed little sign of easing.

Hindustan Times says the Fed raised rates earlier in September and that the next meeting is on 27-28 October. It says New York Fed President John Williams suggested there may be no urgency to raise rates in October, while all but two of 18 FOMC officials projected at least one more rise this year. The same release put second-quarter GDP growth at an annualised 2.2%, revised up from 1.5%.

Every sentence links to the reporting it rests on.

Left1 outlet

Framing
Emphasises persistent price pressure rather than a surprise to the downside.
Emphasis
Lack of easing.
Leaves out or plays down
Forecast comparisons and detail are not visible in its headline and lede.
For example
“Fed’s Preferred Inflation Gauge Points to Continued Price Pressures” — The New York Times

Centre2 outlets

Framing
The Hill leads on the dip and possible rate hikes; Hindustan Times presents mixed signals for the Fed.
Emphasis
Fed rate outlook, GDP, consumer spending and confidence.
Leaves out or plays down
Less on methodology revisions and energy drivers.
For example
“as multiple central bank officials have said future interest rate hikes could be on the horizon” — The Hill
“giving the Fed mixed signals ahead of its next rate decision in October” — Hindustan Times

Right2 outlets

Framing
Stresses that inflation came in below expectations.
Emphasis
Gap versus forecasts; Breitbart adds revisions, energy and GDP.
Leaves out or plays down
Less on the Fed's rate-hike outlook and the 3.4% level remaining well above the 2% target.
Charged language
“Much Lower Than Expected”
For example
“rose by much less than expected in August” — Breitbart
“less than Wall Street expected” — Just the News