July PCE inflation index held at 3.7% annual pace, slightly hotter than expected

The Personal Consumption Expenditures index — the Federal Reserve’s preferred inflation measure — held at a 3.7% annual pace in July, slightly higher than forecasted and reflecting persistent cost pressures for consumers.

Economists polled by FactSet had predicted a 3.6% annual increase. Wednesday’s report instead showed that inflation remained unchanged from June.

PCE tracks changes in the prices of goods and services bought by U.S. households. The measure is closely tracked by the Federal Reserve, which uses it to inform its interest rate decisions.

—This is a developing story and will be updated.