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The Personal Consumption Expenditures index, the Federal Reserve’s preferred inflation measure rose 0.4% in May to an increase of 3.9% from May 2020. The core rate, which excludes food and energy prices, climbed at a 3.4% rate from May 2020. That was the highest annual rate since 1991.

In another looks at the health of the U.S. economy, personal spending stagnated in May as consumers put off purchase of goods. Adjusted for inflation spending on goods fell 2% while spending on services climbed 0.4%.

Incomes declined for a second month, falling 2% in May.

In Congressional testimony on Tuesday Fed chair Jerome Powell repeated the central bank’s mantra that elevated inflation is temporary. Powell told that “a pretty substantial part or perhaps all of the overshoot in inflation comes from categories that are directly affected by the reopening of the economy,” and should therefore be expected to dissipate over the course of the year.

On the bond market the yield on the 10-year Treasury rose 4 basis points to 1.53%.