The Fed’s preferred gauge shows inflation rose 4.9% in April in a sign that price increases could be slowing

People shop in a supermarket in Washington, DC, on May 26, 2022, as Americans brace for summer sticker shock as inflation continues to grow.

The Commerce Department reported Friday that the Federal Reserve's preferred inflation gauge rose 4.9% in April from a year ago, a still-elevated level that indicated that price pressures could be easing a bit.

The increase in the core personal consumption expenditures price index was in line with expectations and reflected a slowing pace from the 5.2% reported in March. The number excludes volatile food and energy prices that have been a major contributor to inflation.

The increase on a monthly basis was the same as in March.

The headline PCE increased in April from a year ago. That was slower than the 6.6% pace in the previous month. The monthly change was up just 2% compared with the 0.9% increase in March.

Inflation has been moving at a fast pace for the past several months. The inability of supply to keep up with demand has caused prices to go up, as well as the war in Ukraine that has caused energy prices to go up and led to fears of food shortages.

The Fed has implemented two interest rate increases totaling 75 basis points and has indicated that a series of hikes are likely ahead until inflation comes closer to the central bank's 2% goal.

The consumer price index is used by the Bureau of Labor Statistics. The headline inflation rate for April was 8.3% higher than last year.

The two numbers are different in that they track data from consumers and businesses. The Fed considers PCE a broader measure of what is happening with prices.

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