US Core PCE Inflation Matches Expectations in April
US Core PCE for April YoY 3.3% vs 3.3% estimate. MoM 0.2% vs 0.3% estimate
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In April, the US Core Personal Consumption Expenditures (PCE) Price Index increased by 3.3% year-on-year, aligning with estimates, while month-on-month growth was 0.2%, slightly below the 0.3% forecast. Personal income remained flat, and consumer spending showed modest growth, indicating ongoing inflationary pressures.
- 01The Core PCE for April year-on-year was 3.3%, matching analyst expectations.
- 02Month-on-month Core PCE growth was 0.2%, below the estimated 0.3%.
- 03Personal income growth for April was 0.0%, significantly lower than the 0.4% estimate.
- 04Real PCE increased by $18.1 billion, reflecting a 0.1% monthly rate increase.
- 05The Federal Reserve uses the Core PCE Price Index as a primary inflation gauge, targeting a long-term inflation rate of 2%.
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The US Core Personal Consumption Expenditures (PCE) Price Index for April reported a year-on-year increase of 3.3%, consistent with market expectations. Month-on-month, the Core PCE rose by 0.2%, falling short of the 0.3% estimate. Personal income growth was stagnant at 0.0%, compared to the anticipated 0.4%, while personal consumption saw a slight increase of 0.1%, revised from 0.2%. The PCE data indicates persistent inflationary pressures, and the Federal Reserve closely monitors these figures to inform interest rate decisions. Additionally, the report highlighted a real PCE increase of $18.1 billion, reflecting a 0.1% monthly growth rate. Market reactions included a slight decline in US stocks, with the S&P down 1.36 points. The Core PCE is crucial as it excludes volatile food and energy prices, providing a clearer picture of underlying inflation trends, which the Fed aims to keep around 2%.
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The PCE data suggests ongoing inflation, which could lead to higher interest rates affecting loans and mortgages.
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