4Monthly PCE inflation stronger, renewing pressure on the Fed
The U.S. personal consumption expenditures (PCE) price index 4rose at a faster month-over-month pace in the month. Core PCE, which excludes food and energy, followed the same trend, and short-term Treasury yields and major indexes reacted shortly after the release.
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The U.S. personal consumption expenditures (PCE) price index 4rose at a faster month-over-month pace in the month. Data released by the U.S. Bureau of Economic Analysis (BEA) showed that the 4monthly figure was higher than in the previous month. The release came 5at the end of the month, local time.
The measure excluding food and energy, known as core PCE, also 4rose at a faster month-over-month pace in the month. Core PCE is classified as the inflation measure preferred by the Federal Reserve. The release confirmed that the core measure also showed a strong trend.
Short-term Treasury yields reacted immediately after the data was released. Major stock indexes also moved up and down, increasing short-term volatility in financial markets. Investors appeared to adjust their positions immediately after the release.
This 4month's figure is used as an input in that process.
Some items are highly seasonal and volatile. Food and energy prices can fluctuate significantly from month to month. The statement also includes trends for individual items.
The consumer price index (CPI) and the schedule for the next Federal Reserve meeting remain variables to watch. Market participants are watching successive inflation indicators and public remarks by the Federal Reserve. Volatility may continue until additional data are released.
Sources: Yahoo Finance,Investing.com News
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