The prospect of the Federal Reserve raising interest rates gained ground on Wednesday after US inflation came in slightly hotter than economists had expected, challenging hopes that price pressures were steadily easing, Reuters reported.
The personal consumption expenditures price index, the Fed's preferred inflation gauge, rose 3.7% in July from a year earlier, accelerating from a 3.6% increase in June, according to government data. The reading adds to the policy dilemma facing Fed Chair Kevin Warsh, who has pledged to bring inflation back towards the central bank's 2% target.
