Personal Consumption Expenditure (PCE) Price Index

Macroeconomics, Industries and Politics
,
41

BoA says softer-than-expected core PCE inflation in March (0.03%) was offset by large upward revisions to the Jan and Feb data. Encouragingly for the Fed, the revisions were mostly in imputed portfolio management fees, which should drop in coming months because of the stock market selloff.

Still, 2.65% y/y inflation is too high given that the favorable 1Q 2024 base effects have now rolled off. And the stickiness appears to be due to demand, rather than supply, suggesting any impact from tariffs is yet to materialize.

image
image900×553 101 KB

https://x.com/neilksethi/status/1918676923527373255

42

I=6
Headline and core PCE for April were in line with expectations

  • Headline PCE and core PCE rose 0.1% in April, in line with expectations.
  • On a yearly basis, PCE slipped to 2.1%, lower than 2.2% estimate.
  • On a yearly basis, core PCE rose 2.5%, in line with estimates.
  • Consumer spending rose 0.2% for the month, in line with expectations but down from 0.7% in March.
  • Personal income rose 0.8, exceeding 0.3% estimate largely due to a one-time social security payments under the Social Security Fairness Act.
  • Real consumer spending rose 0.1%, against expectations to remain unchanged from the previous month.
1 Like
43

Core inflation rose 2.7% in May, more than expected while consumer spending dropped 0.1% on the month, against expectations for a 0.1% increase

  • Core PCE rose 0.2% in May, exceeding expectations to stay steady at 0.1%.
  • On a yearly basis, core PCE rose 2.7%, against expectations to remain steady at 2.6% (April’s revised upwards from 2.5%).
  • Headline PCE rose 0.1% on the month and 2.3% on a yearly basis, both in line with estimates.
  • Consumer spending fell 0.1% for the month, against expectations for a 0.1% increase.
  • Personal income declined 0.4% versus expectations for a 0.3% increase.
  • Markets were little changed following the report.
44

I=5
PCE and consumer spending were in line with expectations in July

  • Core PCE rose 0.3% in July, in line with estimates.

  • On a yearly basis, core PCE rose 2.9%, up from 2.8% in June but in line with expectations.

  • Headline PCE rose 0.2% on the month and 2.6% y/y, both in line with expectations.

  • Real consumer spending rose 0.3% on the month while personal income rose 0.4%, both in line with expectations.

1 Like
45

I=5
Fed’s favorite inflation gauge was in line with estimates in August

  • PCE rose 0.3% in August, putting the yearly rate at 2.7%.
  • Core PCE rose 0.2%, putting the yearly rate at 2.9%.
  • All the numbers were inline with estimates.
  • Personal income and personal consumption expenditures rose 0.4% and 0.6% respectively, both 0.1% higher than estimates.
  • The data indicate Trump’s tariffs have had limited pass-through effect on consumers and that consumers continue to spend strongly.
  • S&P 500 futures rose 0.3% while Nasdaq 100 futures gained 0.2% following the report.
46

I=7
Stock futures rose 0.5%+ as Fed’s favorite inflation gauge (core PCE) came in line with estimates in September

  • Core PCE rose 0.2% in September while headline PCE rose 0.3%, both in line with the estimates.

  • On a yearly basis, core PCE and headline PCE rose 2.8% versus estimates of 2.9% and 2.8%, respectively.

  • Personal income rose 0.4% on the month while spending was up 0.3% versus estimates of 0.3% and 0.2%, respectively.

  • Real consumer spending was flat during the month versus expectations of a 0.1% increase.

  • The report is likely to offer support to those calling for a rate cut next week.

  • S&P 500 futures and Nasdaq Composite rose 0.5% and 0.7% respectively, following the report.

47

I=6
Fed’s favorite inflation gauge (core PCE) came in line with estimates in April

  • Core PCE rose 0.2% in April versus expectations to stay unchanged at 0.3%.
  • Headline PCE rose 0.4% on the month, below 0.5% estimate and down from 0.7% in the previous month.
  • Personal income was flat on the month versus expectations for it to grow by 0.4%.
  • Personal spending rose 0.5% on the month, in line with the forecast but down from 1% in the previous month (revised upwards from 0.9%).
  • Core PCE rose 3.3% while headline PCE was up 3.8% on a yearly basis, both in line with estimates.
48

I=6
Fed’s favorite inflation gauge (core PCE) came in line with estimates in April

  • PCE rose 0.4% in May, below 0.5% estimate and unchanged from the prior month.
  • Core PCE rose 0.3% on the month, in line with estimates and unchanged from April (revised upwards from 0.2%).
  • PCE rose 4.1% y/y, in line with expectations but up from 3.8% in April.
  • On a yearly basis core PCE was up 3.4%, in line with estimates but up 0.1% from the previous month.
  • Personal spending rose 0.7% (inflation rate: 0.5%), above 0.6% and compared to 0.4% in April (revised downward from 0.5%).
  • Personal income rose 0.7% on the month, exceeding 0.4% estimate and compared to flat growth in the prior month.