Fed's favored inflation gauge remained elevated in February, delayed report shows
Commerce Department releases closely watched February 2026 PCE inflation data
New data shows strength in US economy
Forbes Media chairman and editor-in-chief Steve Forbes and chief economist for the Heritage Foundation EJ Antoni discuss new data showing U.S. economic resilience, market volatility due to geopolitical events and Federal Reserve policy on ‘Kudlow.’
This story about the February 2026 PCE inflation is developing and will be updated with more details.
The Federal Reserve's preferred inflation gauge remained stubbornly high in February as consumers continued to face elevated price growth.
The Commerce Department on Thursday reported that the personal consumption expenditures (PCE) index rose 0.4% on a monthly basis in February and is up 2.8% from a year ago. Both figures were in-line with the expectations of economists polled by LSEG.
Core PCE, which excludes volatile measurements of food and energy prices, was up 0.4% from a month ago and increased 3% year over year. Both figures were in line with economists' expectations from the LSEG poll.
Federal Reserve policymakers are focusing on the PCE headline figure as they try to bring inflation back to their long-run target of 2%, though they view core data as a better indicator of inflation. Compared with January's readings, headline PCE inflation held steady at 2.8%, while core PCE decreased slightly from 3.1%.
Prices for goods were up 1.2% in February on an annual basis, down from 1.3% in January. Goods price growth had slowed over the course of 2025, declining from an annual reading of 4.2% in January 2025 to 0.1% in December.
Services prices were up 3% from a year ago in February, an increase from the 2.6% reading in January. The index was last this high in January 2025, when services prices were up 2.9% on an annual basis.
A customer shops for groceries at a grocery store on Sept. 10, 2024 in San Rafael, California. (Justin Sullivan/Getty Images)
This is a developing story. Please check back for updates.