Feb. 28 (UPI) -- The Federal Reserve's preferred inflation gauge rose in line with expectations in January, according to a report by the Bureau of Economic Analysis.
The personal consumption expenditures index, or PCE, rose 0.3% in January for an annual rate of 2.5%,. Excluding food and energy, the core PCE rate rose 0.3% for the month and 2.6% annually.
Personal income was up 0.9%, higher than the expected increase of 0.4%. Spending was down 0.2%.
"The increase in current-dollar personal income in January primarily reflected increases in personal current transfer receipts, compensation, and personal income receipts on assets. The $30.7 billion decrease in current-dollar PCE in January reflected a decrease of $76.7 billion in spending for goods and an increase of $46.0 billion in spending for services."
Prices for goods was up 0.5% in January as motor vehicle prices rose 0.9% and gasoline was 2% higher.
Services prices were up 0.2% while housing inflation was up 0.3%.
The Federal Reserve held interest rates in place at a rate of 4.25%-4.5% in January after three consecutive declines.
It is set to decide on interest rates again during its next meeting in March, with Friday's report likely signaling that rates will not be cut.
