Just What Is The PCE, Anyway?
By John Persinos
Inflation is a crucial factor in the financial world, influencing everything from interest rates to stock market performance. Wall Street keeps a close eye on various inflation measures, but one, in particular, garners the most attention: the personal consumption expenditures (PCE) price index.
Below, I explain why the PCE inflation price index looms large on Wall Street, why the Federal Reserve prefers this gauge, and why it's considered a better indicator than the more popularly known consumer price index (CPI).
But first, let's take a look at the latest PCE release and what it portends for the financial markets.
Inflation during May decelerated to its lowest annual rate in more than three years, the U.S. Bureau of Economic Analysis (BEA) reported on Friday.
The core PCE price index last month increased a seasonally adjusted 0.1% for the month and was up 2.6% from 12 months ago, the latter number down 0.2 percentage point from the April level (see chart).
Both numbers were in line with consensus estimates. May marked the lowest annual rate since March 2021.
Including food and energy, headline inflation was flat on the month and also up 2.6% on an annual basis. Those readings were in line with expectations.
Read More...
没有评论:
发表评论