June 2026 PCE Inflation Cools Amid Iran Ceasefire, Fed Holds Rates Steady

The Commerce Department reported that the Personal Consumption Expenditures (PCE) price index fell 0.1 % month-on-month in June, bringing the annual headline rate to 3.7 %, down from 4.1 % in May. Core PCE—excluding food and energy—rose 0.1 % month-on-month and was 3.3 % year-over-year. Energy-related prices, especially gasoline, dropped 9.2 % in June, the steepest monthly fall since August 2022, after a brief U.S.–Iran ceasefire reduced oil market pressure.

CNNUS June PCE Inflation Cools as Core Gauge Falls to 3.3%, Easing Fed Policy Pressure Fox Business (website)Fed's Key Inflation Gauge Declines in June as Consumer Spending Holds Firm — BigGo Finance PCE Report: Fed's Preferred Inflation Gauge Rises 3.7% In June, Q2 GDP Grows At 1.5% CNBCNew York TimesAdvisors take note: PCE cools in June, but don't expect the Fed to turn dovish yet PBS News Hour

In mid-June the United States and Iran signed a Memorandum of Understanding that temporarily halted hostilities, prompting oil prices to retreat toward pre-war levels. The respite collapsed later in the month, and missile exchanges resumed in July, raising concerns that gasoline costs could climb again. Analysts note that the June inflation dip was “largely driven by energy prices.”

CNN

• Headline PCE: –0.1 % MoM; +3.7 % YoY.

PCE Report: Fed's Preferred Inflation Gauge Rises 3.7% In June, Q2 GDP Grows At 1.5%

• Core PCE: +0.1 % MoM; +3.3 % YoY.

PCE Report: Fed's Preferred Inflation Gauge Rises 3.7% In June, Q2 GDP Grows At 1.5%

• Gasoline & energy goods: –9.2 % MoM.

CNN

• Consumer spending: +0.3 % MoM, inflation-adjusted up 0.4 %.

CNN

• Personal savings rate: 2.7 % in June.

Fox Business (website)

• Q2 GDP: 1.5 % annualized, below the 1.8 % forecast.

PCE Report: Fed's Preferred Inflation Gauge Rises 3.7% In June, Q2 GDP Grows At 1.5%

Beth M. Hammack (Cleveland Fed), Neel Kashkari (Minneapolis Fed) and Lorie K. Logan (Dallas Fed) dissented, each preferring a 25-basis-point hike. Fed Chair Kevin M. He added that the Fed will continue to monitor inflation data over the coming months.

Fed holds rates at 3.5% to 3.75% for fifth straight meeting

Most outlets report core PCE’s month-on-month change as 0.1 %, matching the Commerce Department figure. Fox Business noted that the LSEG poll had expected a 0.2 % rise, describing the actual result as “cooler than forecast.” TradingKey listed the core PCE increase as 0.2 %, creating a discrepancy that has not been reconciled.

PCE Report: Fed's Preferred Inflation Gauge Rises 3.7% In June, Q2 GDP Grows At 1.5%

• “Setting aside the volatility caused by oil and energy prices, underlying inflation is moving right around 3%, so that’s not going to provide material comfort to households or investors,” — Joe Brusuelas, RSM US chief economist

CNN

• “We got some encouraging inflation data, and we’ll be watching inflation data over the period ahead,” — Kevin M. Warsh, FED CHAIR

Fed holds rates at 3.5% to 3.75% for fifth straight meeting