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PCE prices rose 0.5% in September; the 12-month rate edged up to 3.6%
The PCE price index rose 0.5% in September and is up 3.6% over 12 months (prior 3.4%). Excluding food and energy: +0.3% on the month, 3.1% over 12 months. The Federal Reserve’s goal is 2% on headline PCE. Consumer spending rose 0.5% (0.0% after inflation); the saving rate is 3.8%.
Q1 What did prices do in September?
The PCE price index rose 0.5% in September after +0.3% in August. Over 12 months it is up 3.6%, above the Federal Reserve’s 2% goal; it was last at or under 2% in February 2021. Excluding food and energy, prices rose 3.1% over 12 months. Annualized, core ran at 2.9% over 3 months and 2.9% over 6.
| Category | Sep | Aug | 3-mo ann. | 6-mo ann. | 12-month | Share of spending |
|---|---|---|---|---|---|---|
| PCE price index | +0.5% | +0.3% | +3.6% | +3.3% | +3.6% | 100.0% |
| PCE excluding food and energy | +0.3% | +0.3% | +2.9% | +2.9% | +3.1% | 88.9% |
| PCE services excluding energy and housing | +0.4% | +0.4% | +3.4% | +3.4% | +3.6% | 51.6% |
| Market-based PCE excluding food and energy | +0.3% | +0.2% | +2.9% | +2.9% | +3.1% | 75.3% |
| Food and beverages for off-premises consumption | 0.0% | 0.0% | −0.3% | +1.5% | +1.5% | 7.0% |
| Energy goods and services | +5.4% | +2.3% | +27.5% | +16.7% | +21.3% | 4.1% |
| Gasoline and other energy goods | +9.2% | +4.4% | +51.6% | +27.9% | +35.4% | 2.4% |
| Goods | +0.8% | +0.3% | +4.3% | +3.0% | +3.9% | 31.1% |
| Services | +0.3% | +0.3% | +3.2% | +3.5% | +3.5% | 68.9% |
| Housing | +0.3% | +0.2% | +3.1% | +3.7% | +3.2% | 15.6% |
| Health care | +0.1% | +0.1% | +1.6% | +2.3% | +3.0% | 17.2% |
| Transportation services | +2.1% | +1.1% | +14.5% | +11.0% | +9.2% | 3.5% |
| Food services and accommodations | +0.4% | +0.5% | +3.4% | +3.2% | +3.5% | 7.2% |
| Financial services and insurance | +0.4% | +0.3% | +3.0% | +4.3% | +4.4% | 8.0% |
One-month changes are BEA’s own published figures (table 2.8.7). PCE prices are seasonally adjusted; BEA publishes no unadjusted PCE price index.
Q2 What makes up the 3.6% 12-month rate?
Each part’s contribution is its share of spending a year earlier times its price change. Core goods and services added +2.78pp, energy +0.77pp and food +0.11pp: +3.66pp in all, against the index’s +3.65%. (BEA’s index is a chained Fisher index, so the shares are an approximation; the build checks they add up.)
Q3 What happened to spending and income?
Consumer spending rose 0.5% in September to an annual rate of $22,453 billion; adjusted for prices, real spending changed 0.0% on the month and +2.5% over 12 months. Personal income changed +0.2% (wages and salaries +0.2%) and disposable income +0.2%. The saving rate was 3.8% of disposable income, against 5.1% a year earlier, the lowest since October 2022.
Q4 Where does this sit in history?
At 3.6%, PCE inflation is the highest since May 2026, at or above 68% of the 785 months since January 1960. Core at 3.1% is the highest since May 2026. Since 1984 PCE inflation has averaged 2.4% (COVID months Mar 2020–Jun 2021 left out of the rankings).
Q5 What did BEA revise?
BEA revises recent months with each release. Against the previous release as stored in our vintage ledger, 1 of 6 monthly changes now read differently:
| Series | Month | 1-month, previous | 1-month now | 12-month, previous | 12-month now |
|---|---|---|---|---|---|
| PCE prices | Jun 2026 | −0.10% | −0.10% | +3.5% | +3.5% |
| PCE prices | Jul 2026 | +0.05% | +0.06% | +3.4% | +3.4% |
| PCE prices | Aug 2026 | +0.31% | +0.32% | +3.4% | +3.4% |
| Core PCE | Jun 2026 | +0.13% | +0.13% | +3.0% | +3.0% |
| Core PCE | Jul 2026 | +0.13% | +0.14% | +3.0% | +3.0% |
| Core PCE | Aug 2026 | +0.25% | +0.26% | +3.0% | +3.0% |
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