Inflation rose to 2.7% in March in preferred Fed gauge

Inflation ticked up to 2.7% for the year ending in March, as measured by the personal consumption expenditures price index, which is the gauge favored by the Federal Reserve.

The 0.2 percentage point rise in headline inflation reported Friday morning by the Bureau of Economic Analysis is bad news for the Fed, which is working to quash inflation by keeping interest rates elevated. The consensus among economists was that PCE inflation would punch in at 2.6%. The Fed’s target is 2% inflation in the PCE index.