A customer shops for second-hand items. Photographer: Stefani Reynolds/AFP/Getty Images
The Federal Reserve's preferred gauge of underlying inflation cooled to an almost three-year low, even with robust holiday spending, keeping the debate alive over whether officials will soon cut borrowing costs.
The so-called core personal consumption expenditures (PCE) price index, which strips out the volatile food and energy components, increased 2.9 percent in December from a year earlier, according to the Bureau of Economic Analysis (BEA). From a month ago, it advanced 0.2 percent.
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