By Howard Schneider and Ann Saphir
WASHINGTON (Reuters) -The mostcurrent U.S. inflation information is “along the lines of what we would like to see,” Federal Reserve Chair Jerome Powell stated on Friday in remarks that appeared to keep the main bank’s standard for interest rate cuts this year undamaged.
The individual intake expenses (PCE) cost index information for February, which was launched on Friday, “is what we were anticipating,” Powell stated, and even however the numbers revealed less of a downturn than last year, “you won’t see us overreacting.”
The information last month were “not as low as most of the great readings we got in the 2nd half of last year, however it’s certainly more along the lines of what we desire to see,” Powell stated throughout an look at the San Francisco Fed where he was talkedto by Kai Ryssdal of public radio’s “Marketplace” program.
Powell’s remarks were in line with his remarks after the Fed’s policy conference last week, in which he stated higher-than-expected inflation in January and February had not altered the sense that rate increases would keep falling this year to the main bank’s 2% target.
U.S. Commerce Department information on Friday revealed the PCE rate index increased at a 2.5% yearly rate in February, up from 2.4% in the prior month. The number leavingout unstable food and energy rates increased 0.3% on a month-to-month basis, somewhat muchfaster than Powell expected when he stated last week that core inflation would be “well listedbelow” 0.3% in February.
Lou Crandall, chief economicexpert at Wrightson ICAP (LON:), stated the unrounded core PCE figure did come in simply listedbelow that figure, at 0.26%. “That’s still above their 2% annualized unbiased, however isn’t a horrible number,” he stated.
Indeed, Powell suggested the mostcurrent PCE report did not weaken the main bank’s standard outlook, however stated with the economy on a “stro