[Hoot Gibson]

Another bad month for the Biden economy.

A key U.S. inflation gauge rose 3.1% year over year, higher than expected

   
[*]The core personal consumption expenditures price index increased 3.1% in April from a year earlier.
   
[*]Federal Reserve officials consider the core PCE to be the best gauge of inflation.
   
[*]Personal income dropped sharply as the effects faded from March’s government stimulus checks.

A key inflation indicator rose a faster-than-expected 3.1% in April as price pressures built in the rapidly expanding U.S. economy, the Commerce Department reported Friday.

The core personal consumption expenditures index was forecast to increase 2.9% after rising 1.9% in March. Federal Reserve officials consider the measure to be the best gauge for inflation, though they watch a number of metrics.

As part of its price stability mandate, the Fed considers 2% to be healthy, though it is committed to letting the level average higher than usual in the interest of promoting full employment.

The index captures price movements across a variety of goods and services and is generally considered a wider-ranging measure for inflation as it captures changes in consumer behavior and has a broader scope than the Labor Department’s consumer price index. The CPI accelerated 4.2% in April.

Over the past month, core PCE rose 0.7 %, also quicker than the expected 0.6%.

Including volatile food and energy prices, the headline PCE index jumped 3.6% year over year and 0.6% from March.