An inflation gauge closely watched by Federal Reserve policymakers ticked higher in October, though it remains near the Fed's inflation target.

The Commerce Department on Wednesday reported that the personal consumption expenditures (PCE) index rose 0.2% in October and 2.3% year over year. Those figures were in line with the estimates of economists polled by LSEG.

Core PCE, which excludes volatile food and energy prices, rose 0.3% for the month and increased 2.8% from a year ago, in line with estimates.

The Federal Reserve is focusing on the PCE headline figure as it tries to bring back the pace of price increases back to 2%, although policymakers view the core data as a better indicator of inflation. Headline PCE was up from 2.1% in September and equaled the 2.3% reading from August, suggesting that inflation ticked slightly higher, while the core PCE was little changed from last month.

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