The Federal Reserve's preferred inflation gauge rose further in April as the Strait of Hormuz energy shock continued to reverberate through the broader consumer basket, the Bureau of Economic Analysis reported Thursday.

The headline PCE price index rose 0.4% on the month, falling short of the 0.5% forecast and decelerating from March's 0.7% increase.

Year-over-year, headline PCE accelerated from 3.5% to 3.8%, matching expectations and marking the highest reading since May 2023.

The core PCE price index, which strips out food and energy, rose 0.2% month-over-month in April, missing the 0.3% consensus and decelerating from March's 0.3% print.

On an annual basis, core PCE edged up from 3.2% in March to 3.3%, matching estimates and marking the highest reading since October 2023.

In a separate release, U.S. gross domestic product expanded at an annualized 1.6% pace last quarter, a downward revision from the initial 2% estimate but still an acceleration from the 0.5% pace seen in the fourth quarter of 2025.

This is a developing story…