PCE Inflation Remains Above Target
The PCE price index—a key measure of inflation—rose 0.3% in December from the prior month. Excluding food and energy, core PCE inflation increased 0.2%. On an annual basis, the headline PCE price index was up 2.6%, while core PCE climbed 2.8%, both above the Federal Reserve’s 2% target.
While inflation is gradually cooling, the pace remains stubbornly high, reinforcing expectations that the Fed will maintain a cautious stance on interest rate cuts. Traders will be closely monitoring upcoming economic data and Fed statements for further policy signals.