PCE index jumps; market “buys” Fed story

28 May 2021

 

Summary: US Fed’s favoured inflation measure jumps in April; above market expectations; annual rate accelerates above 3%; bond market accepting Fed “transitory” position; Treasury bond yields lower.   One of the US Fed’s favoured measures of inflation is the change in the core personal consumption expenditures (PCE) price index. After hitting the Fed’s target at the time of 2.0% in mid-2018, the annual rate then hovered in a range between...

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