January PCE neared the Fed's 2% target, but core inflation rose to 2.7%. Services increased, while goods saw their fourth deflation in five months.
PCE price index Feb
28/3/2025 (Fri)
Previous: 2.6% Forecast: 2.7%
Though the headline PCE price index showed the central bank was nearing its goal in January, the inflation rate was at 2.7% excluding food and energy, slightly higher than forecast.
The move in inflation was tilted toward services prices, while goods prices decreased 0.1%, the fourth outright deflation figure in the past five months for the category. Housing prices eased off their pace, rising 0.3%.
A separate report showed US consumer spending fell for the first time in nearly two years in January, setting up the inflation for cooling weaker growth. But more US tariffs are fuelling inflation expectation.
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