Fed officials use the PCE measure as their main baseline to gauge inflation, which continues to run above the central bank's 2% long-range target.

The personal consumption expenditures price index increased 0.1% on the month and was up 2.5% from a year ago, in line with Dow Jones estimates, the Commerce Department reported Friday. The year-over-year gain in May was 2.6%, while the monthly measure was unchanged.

An important gauge for the Federal Reserve showed inflation eased slightly from a year ago in June, helping to open the way for a widely anticipated September interest rate cut.

Core inflation, which excludes food and energy, showed a monthly increase of 0.2% and 2.6% on the year, both also in line with expectations. Policymakers focus even more on core as a better gauge of longer-run trends as gas and groceries costs tend to fluctuate more than other items.

Stock market futures indicated a positive open on Wall Street following the release while Treasury yields moved lower. Futures markets price in a more aggressive path for Fed interest rate cuts.

"A two-word summary of the report is, 'good enough,'" said Robert Frick, corporate economist with Navy Federal Credit Union. "Spending is good enough to maintain the expansion, and income is good enough to maintain spending, and the level of PCE inflation is good enough to make the decision to cut rates easy for the Fed."

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