US April PCE rises 3.8% year-on-year, meeting expectations amid inflation pressures

(CNA, Washington, May 28) The Personal Consumption Expenditures (PCE) price index for April, the inflation indicator favored by the US Federal Reserve, rose 3.8% year-on-year, in line with market expectations, but also showed that inflation driven by the conflict in the Middle East is affecting US private consumption. According to AFP and CNBC, the US Department of Commerce announced today that the April PCE was consistent with the forecasts of economists surveyed by Dow Jones Newswires and The Wall Street Journal, and was higher than the 3.5% in March. The Department of Commerce stated that the seasonally adjusted PCE for April rose 0.4% month-on-month, slightly lower than the market estimate of 0.5%. The core PCE, which excludes volatile items such as food and energy, rose 3.3% year-on-year, in line with market expectations, and 0.2% month-on-month, slightly lower than the market estimate of 0.3%. Last month's data shows that inflation continues to affect US consumer spending, which may lead the Fed to continue observing and waiting for price increases to slow down. The Fed uses PCE data as a primary indicator to judge and forecast inflation, and believes that core PCE better reflects long-term price trends.