Key Inflation Metric Rose to 40-Year High in March

A key inflation index watched closely by the Federal Reserve showed that consumer prices hit a 40-year high in March.

The Personal Consumption Expenditures (PCE) price index increased by 6.6% for the year ended in March, according to the Bureau of Economic Analysis. It was the highest annual growth rate since the period ended January 1982, and outpaced the 6.4% annual figure from February.

The core PCE, which omits volatile food and energy costs, rose by 0.3% in March for the second month in a row. The core PCE rates for February and March were the smallest back-to-back readings since last summer. The annual core inflation rate for the year ended in March fell to 5.2% from 5.3% in February, the first month-to-month decline since February 2021.

News reports across the political spectrum highlighted the core PCE's slower pace of growth as a "silver lining" in an otherwise concerning report about high consumer prices. Some reports from left- and center-rated sources focused more on how consumer inflation may be peaking. Some coverage from right-rated outlets tied high consumer costs to Biden's low approval ratings and framed the data as ominous for Democrats ahead of the 2022 midterm elections.