The Fed’s “preferred” inflation gauge (Personal Consumption Expenditures, or PCE) not only came in worse than expected, but the prior three months were all revised higher as well.

“The whole thing throws a lot of cold water on the ‘disinflation’ hoopla,” observed Wolf Richter of 

Even worse, on a year-over-year basis, the PCE Price Index for services spiked by 5.6%–the worst since 1984. 

Services is where inflation is running hot, and services make up almost two-thirds of consumer spending. (Chart from

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