U.S. personal income and spending both accelerated during July, while a key gauge of inflation remained within the U.S. Federal Reserve’s zone of comfort.

A price index for personal consumption expenditures rose 0.1% in July compared to the prior month. The index increased by 0.2% in June. The PCE price index excluding food and energy, or core PCE, rose 0.1%, after increasing during June by 0.2%.

Compared with a year earlier, the PCE price index climbed 2.1% in July. The year-over-year climb in June was 2.3%. The PCE price index excluding food and energy, year over year, rose 1.9% in July and 1.9% in June.

The Federal Reserve watches the year-over-year PCE price index excluding food and energy closely for signs of problematic inflation. The central bank’s preferred range for this core gauge is considered to be 1.0% to 2.0%.

Personal income rose at a seasonally adjusted rate of 0.5% compared to the month before, the Commerce Department said today. Income increased 0.4% in June, which was unrevised.

July personal consumption grew by 0.4% compared to the month before. Spending increased 0.2% in June; originally, spending for that month was seen 0.1% higher.

Disposable personal income — income after taxes — climbed by 0.6% after rising 0.4% in June.

Spending on durable goods, those designed to last three years or longer, rose 0.3% in July, after decreasing by 1.7% in June. Non-durable goods spending rose 0.5% in July, after staying flat in June. Spending on services rose 0.4% in July, after increasing by 0.6% in June.

Commerce reported personal saving as a percentage of disposable personal income was 0.7% in July. It was 0.5% in June.