December Data Reveals Persistent Price Pressures in Fed’s Preferred Inflation Measure
White House senior counselor Peter Navarro discusses Trump’s Goldilocks economy, citing low inflation, rising wages, and job growth. He also addresses the Supreme Court’s tariff decision, the White House strategy for AI’s impact on jobs, and more.
The Federal Reserve’s preferred inflation gauge remained elevated in December, as price pressures continued to pose a challenge for consumers. The latest data reveals that inflation is still a significant concern, impacting household budgets and spending habits.
On Friday, the Commerce Department reported that the personal consumption expenditures (PCE) index rose by 0.4% in December on a monthly basis. Year-over-year, the index is up 2.9%. These figures exceeded the expectations set by LSEG economists, who had predicted a monthly increase of 0.3% and an annual rise of 2.8%.
When looking at the core PCE, which excludes the more volatile food and energy prices, the index also increased by 0.4% month-over-month and rose 3% year-over-year. Again, these results were above the forecasts from economists polled by LSEG, who anticipated increases of 0.3% and 2.9%, respectively.
Policymakers at the Federal Reserve are closely monitoring the PCE headline figure as they aim to bring inflation back to their long-term target of 2%. However, they consider core data to be a more reliable indicator of underlying inflation trends.
Notably, the headline PCE has shown an upward trend, moving from 2.7% in October to 2.8% in November, and reaching 2.9% in December. Core PCE readings have fluctuated between 2.8% and 2.9% since May, before hitting 3% in December.
This is a developing story about the December PCE inflation report. Please check back for updates.
White House senior counselor Peter Navarro discusses Trump’s Goldilocks economy, citing low inflation, rising wages, and job growth. He also addresses the Supreme Court’s tariff decision, the White House strategy for AI’s impact on jobs, and more.
The Federal Reserve’s preferred inflation gauge remained elevated in December, as price pressures continued to pose a challenge for consumers. The latest data reveals that inflation is still a significant concern, impacting household budgets and spending habits.
On Friday, the Commerce Department reported that the personal consumption expenditures (PCE) index rose by 0.4% in December on a monthly basis. Year-over-year, the index is up 2.9%. These figures exceeded the expectations set by LSEG economists, who had predicted a monthly increase of 0.3% and an annual rise of 2.8%.
When looking at the core PCE, which excludes the more volatile food and energy prices, the index also increased by 0.4% month-over-month and rose 3% year-over-year. Again, these results were above the forecasts from economists polled by LSEG, who anticipated increases of 0.3% and 2.9%, respectively.
Policymakers at the Federal Reserve are closely monitoring the PCE headline figure as they aim to bring inflation back to their long-term target of 2%. However, they consider core data to be a more reliable indicator of underlying inflation trends.
Notably, the headline PCE has shown an upward trend, moving from 2.7% in October to 2.8% in November, and reaching 2.9% in December. Core PCE readings have fluctuated between 2.8% and 2.9% since May, before hitting 3% in December.
This is a developing story about the December PCE inflation report. Please check back for updates.
