June 2026 inflation: PCE 3.3%, CPI 2.6%

In June 2026 the core Personal Consumption Expenditures price index rose to 3.3% while the core Consumer Price Index climbed to 2.6%, keeping both gauges above the Federal Reserve’s 2% target. The PCE is compiled by the Bureau of Economic Analysis and is the Fed’s preferred gauge; the CPI is produced by the Bureau of Labor Statistics and is more often cited in press reports.

Both core measures exclude food and energy to highlight underlying price trends, but they differ in coverage and calculation. Core PCE tracks a broader set of consumer spending and uses weights that adjust for changing purchases, which typically reduces month-to-month volatility compared with core CPI.

At its most recent meeting the Federal Open Market Committee left the target federal funds rate at 3.50%–3.75% for the fifth consecutive session. The committee’s statement read, “Inflation remains elevated relative to the Committee’s 2 percent goal, in part reflecting supply shocks that have driven price increases in certain sectors, including energy,” and added that policymakers “will deliver price stability.” The CME FedWatch Tool assigns about a 63% probability of a 25 basis-point increase at the September meeting and a 37% chance of no change.

Historical data show a persistent divergence between the two series. Since 1960 core CPI has risen roughly 1,005% while core PCE has increased about 723%. Core CPI has exceeded core PCE about 80% of the time and has averaged around 47 basis points higher. In November 2025 core PCE moved above core CPI; the most recent spread stands near negative 69 basis points.

Both indexes spiked during the pandemic-era inflation surge. Core PCE peaked near 5.57% in February 2022 and core CPI reached about 6.63% in September 2022. After those peaks inflation slowed, but progress toward the Fed’s 2% target has recently stalled; Fed officials have described the remaining disinflation as the “last mile.”

Analysts point to supply shocks, especially in energy, and continued price gains in shelter and services as factors keeping core measures elevated. Policymakers use core readings to filter out volatile food and energy prices, while noting that headline inflation that includes those items still affects household budgets.

The June readings leave the Fed with a choice over whether to resume raising rates later this year. Officials review a range of core inflation indicators rather than relying on a single monthly report, and markets will weigh incoming data ahead of the September meeting.