How the Fed's Favorite Inflation Gauge Now Reads 3.4 Percent

Inflation Explained with Fexingo: CPI, Prices, and the Cost of Living for Everyday People · Jun 28, 2026 · 8m · transcript

The Fed's preferred inflation measure, the core PCE price index, hit 3.4 percent in May 2026 — its highest since October 2023. Lucas and Luna dig into why this number matters more than CPI, how it's calculated differently, and what it means for the timing of rate cuts. They explore the role of services inflation, the divergence between PCE and CPI, and why the Fed is unlikely to cut rates before September even as the economy shows signs of cooling. A focused look at the one inflation number that actually guides policy.

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