Prices of core PCE services ex-housing rose 0.37% in September, pushing the 12-month change to 3.6% and matching the highest such reading since 2024.

Core goods was also firm at 0.20%. While core goods prices were back in 2024 were falling on a year-over-year basis (as was the pre-pandemic trend), those prices are now at 2%. If core goods prices rise like this going forward, there will need to be more services disinflation for the Fed to achieve its 2% target.