India, June 25 -- The Federal Reserve's favorite inflation report showed that price pressures stayed strong in the economy, which could make the central bank more careful about cutting interest rates. The report showed that core inflation, which removes food and energy prices, rose 0.3% in the month and increased at a 3.4% annual rate, according to the US Commerce Department report.

The 3.4% yearly core inflation reading was exactly what economists surveyed by Dow Jones expected. This was the highest core PCE inflation level since October 2023, showing that inflation is still proving difficult to bring down.

The data is important because the Federal Reserve closely watches the Personal Consumption Expenditures (PCE) Price Index when mak...