U.S. inflation picked up slightly more than expected at the end of the year, according to closely watched data released Friday by the Commerce Department.
The personal consumption expenditures (PCE) price index — the Federal Reserve’s preferred inflation gauge — rose 0.4% in December, following a 0.2% increase in November. Economists had projected a more modest 0.3% gain.
On a year-over-year basis, headline PCE inflation accelerated to 2.9% from 2.8% in November. Analysts had anticipated the annual rate would hold steady.
Core PCE, which excludes volatile food and energy components, also increased 0.4% in December after rising 0.2% the previous month, exceeding expectations for a 0.3% advance.
The annual core reading climbed to 3.0%, up from 2.8% in November and slightly above forecasts calling for 2.9%.
The inflation figures were published as part of the Commerce Department’s broader report on personal income and spending.
That report showed personal income grew 0.3% in December, easing from a 0.4% increase in November. Meanwhile, personal spending rose 0.4%, matching the pace recorded the previous month.