Elevated inflation boosts chances for Fed interest rate cut next week

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The Personal Consumption Expenditures price index, the Federal Reserve’s preferred measure of inflation, remained elevated in September, according to the Associated Press.

The news could ease the way to a widely expected interest rate cut by the central bank at its meeting Dec. 9-10.

The Commerce Department on Friday reported that prices rose 0.3% in September from August — the same as the previous month. The report had been delayed five weeks by the government shutdown.

So-called “core” prices, which exclude the volatile food and energy categories, rose 0.2% in September from August, also in line with the previous month.

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Overall, September prices rose 2.8% from one year ago compared to August’s 2.7%. Core prices were also up 2.8% from a year earlier, just down from August’s 2.9% figure.

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