Economics
Two US Cost Gauges Surpass Estimates, Stoking Inflation Concern
- Employment costs rose 1.3% last quarter, more than forecast
- Fed’s preferred price index gained 1% on monthly basis
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Two key US inflation gauges posted larger-than-forecast increases on Friday, heightening concerns that prices will remain persistently high and prompt continued aggressive interest-rate increases from the Federal Reserve.
The Labor Department’s employment cost index, a broad gauge of wages and benefits, increased 1.3% in the second quarter from the prior three months, compared with a 1.2% median estimate from economists. Separately, the Commerce Department’s personal consumption expenditures price index, which forms the basis for the Fed’s inflation target, rose on a monthly basis in June by 1%, the fastest since 2005.