Headline inflation comes down, but the Federal Reserve’s preferred inflation gauge is struggling to decline.
The personal consumption expenditure (PCE) price index eased to 3.8 percent year-over-year in May, down from 4.3 percent in April. PCE rose 0.1 percent, down from 0.4 percent.
Core PCE, which is the central bank’s top inflation measurement, dipped to just 4.6 percent last month, down from 4.7 percent in April. This was also slightly below the consensus estimate of 4.7 percent.
On a month-over-month basis, core PCE climbed at a smaller-than-expected pace of 0.3 percent, down from 0.4 percent.
The next critical report will be next week’s June jobs report. It is expected to show the U.S. economy creating 223,000 new jobs, which means the country actually produced 400,000 positions.
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