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 2.0% in mid-2018, the annual rate then hovered in a range between 1.8% and 2.0% through to the end of 2018. However, since then the annual rate has fallen quite noticeably.
The latest figures have now been published by the Bureau of Economic Analysis as part of the March personal income and expenditures report. Core PCE inflation was zero for the month, less than February’s +0.1% and lower than the expected +0.2% increase. On a 12-month basis, the core PCE inflation rate fell from February’s figure of 1.7% to 1.6%.
