The Commerce Department reported Thursday that the Federal Reserve's favorite inflation measure rose to its highest annual level since 1983.
Excluding food and energy prices, the personal consumption expenditures price index increased in the first half of the year, the biggest jump since 1983.
The headline PCE measure jumped 6.4%, the fastest pace since 1982.
The core PCE increase was lower than expected. The gauge was up 0.4% on a monthly basis.
Consumer spending rose just 2% for the month, below the estimate. The increase in disposable income was less than expected. Savings went up to $1.15 trillion, or a rate of 6.3%.
The Labor Department reported that there were 202,000 initial jobless claims for the week ended March 26. That was an increase of 14,000 from the previous week and ahead of the estimate, but still below the level that prevailed prior to the Covid pandemic.
The number of continuing claims, which run a week behind the headline number and count those who filed for a second week, dropped to just over 1.3 million, the lowest level since 1969.
While the employment picture has tightened, it is inflation that has captured much of the attention.
The Fed is expected to raise the interest rate in March and every other meeting this year, in response to rapidly rising inflation.
Goods prices climbed by 1.1% for the month, the fastest increase since October 2021, pressured by supply chain backups that have bedeviled the economy for much of the pandemic era. When the Fed capitulated on the loosest monetary policy in its history, it had to abandon its description of those problems as transitory.
In February, the price increases shifted from long-term purchases to short-term purchases. Non-durable prices rose 1.8%, while inflation for durables was flat.
Services inflation rose just 3%.
Food inflation rose 0.4% in March, down from the increase of a month ago, but energy prices jumped 3.7% for the month.
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