PCE core y/y
- Prior was +3.2%
- PCE core m/m +0.2% vs +0.2% expected
- Prior m/m core +0.1%
- Headline PCE +2.6% vs +2.6% expected (prior +2.6%)
- Deflator m/m +0.2% vs +0.2% expected (prior -0.1%)
- Full report
Consumer spending and income for December:
- Personal income +0.3% vs +0.3% expected. Prior month +0.4%
- Personal spending +0.7% vs +0.4% expected. Prior month +0.2% (revised to +0.4%)
- Real personal spending +0.5% vs +0.3% prior (revised to +0.5%)
The soft headline inflation number in yesterday’s GDP data led to broad speculation about a downside miss on December headline PCE. However it was the core where there was a slight miss.
One spot the Fed watches closely is PCE services ex-energy and housing. It rose 0.3% m/m compared to 0.1% prior and that could help to lift the dollar. Treasury yields have ticked up to session highs in the aftermath but only up 1-2 bps since the release.
Three-month and six-month annualized core and headline PCE are now both below the Fed target.
- Goods prices -0.2% m/m
- Services prices +0.3% m/m
- Real personal spending up 3.2% y/y
- Services inflation 3.9% y/y vs 4.1% prior