A key measure of inflation rose last month at the fastest pace since March of 2022.
The personal consumption expenditure price index for services excluding housing and energy services—often called “super core” inflation—rose 0.6 percent in January. This inflation gauge rose this much in March of 2022, December of 2021, and in March of 2021.
It is historically rare for this metric of inflation to rise at this high of a monthly pace. Prior to Biden’s presidency, it had only happened three times in this century, including a single month immediately following the 9/11 terror attacks. Before that, the measure had not jumped 0.6 percent since 1993.
High inflation in the services sector is typically regarded as more persistent and less responsive to monetary policy than goods inflation.
Fed chairman Jerome Powell and other Fed officials have said they keep a close eye on PCE services excluding housing and energy an indicator of where inflation may be headed in the future.
The monthly gain would translate into an annual rate of 7.4 percent if it persisted. Over the past 12 months, it is up 3.5 percent.
