PCE

The personal consumption expenditures price index, better known as the PCE, tracks what we paid for goods and services in the previous month.

When we focus on recent months rather than year-on-year increases, inflation numbers look pretty good, says economist Alan Blinder.

Though the Federal Reserve's actions are being felt throughout the economy, stabilizing prices could take 12 to 18 months.

The PCE and CPI measure different things, but the message they send to consumers may influence expectations — that then can affect inflation.

For monetary officials, the personal consumption expenditures gauge beats the CPI. A trip to the grocery store helps explain why.

"A look at the record shows that the Fed often stumbles in its efforts to save the day," says Ben White, chief economic correspondent at Politico.

The Fed's preferred means of measuring inflation jumped 0.6% in October.

The personal consumer expenditures price index is one of the Fed's favorite tools for tracking inflation.

Core inflation strips out food and energy prices, because they can be pretty volatile.

The Consumer Price Index tracks the average price change over time for a “basket”  of goods and services. The CPI takes into account things like food, transportation and health care. If the CPI goes up, that’s considered an indication that the inflation rate is rising. But when the Federal Reserve calculates the inflation rate, it […]