Inflation as measured by the Federal Reserve's preferred gauge came in cooler than expected last month, according to data released Wednesday by the Bureau of Economic Analysis.

The personal consumption expenditures (PCE) price index rose 0.3% month-over-month, below economists' expectations of 0.4%.

On an annual basis, headline PCE inflation held at 3.4%, matching July's revised reading and below the 3.7% consensus.

Core PCE, which excludes volatile food and energy prices, rose 0.2% month-over-month, compared with a 0.3% forecast. The annual core rate slowed to 3.0% from 3.3%, below expectations of 3.3%.

At 3.0%, core inflation remains a full percentage point above the Fed's 2% target.

The release included the BEA's annual revisions, which also lowered past inflation. Core PCE prices rose at an annualized 3.3% in the second quarter, down from 3.6% previously estimated.

Second-quarter GDP growth was revised up, to 2.2% from 1.5%.

This is a developing story…