PCE index, preferred by the Fed, comes in below projection at the margin By Investing.com

Investing.com – The , measured by the PCE price index and preferred by the Federal Reserve (Fed, US central bank), rose 0.3% in February, below economists’ estimate of 0.4%, according to data released this Friday, 29. In January, the indicator had risen 0.4%, revised from 0.3%. As a result, the annual PCE variation rose from 2.4% to 2.5%, as expected.

The , which excludes volatile prices such as energy and food, increased by 0.3% in February, in line with market projections, after rising 0.5% in the previous month, revised from 0.4%. Thus, the index went from 2.9% (revised from 2.8%) to 2.5% in the annual comparison.

For Thomas Monteiro, an analyst at Investing.com, the deceleration of the core PCE index may indicate a change in focus in the Fed’s monetary policy. “With the retreat of the core PCE in relation to January, it should open space for a Powell monetary policy focusing on growth as a key variable. The probability is that the US central bank will once again turn its attention to maintaining a robust labor market, which has shown its first signs of weakening”, assesses Monteiro, who highlights the The Fed’s dual monetary policy mandate: price stabilization and pursuit of full employment.

“We will have plenty of time to digest the numbers before the stock exchange opens on Monday, April 1st”, continues the analyst, pointing out that the data was released on the Good Friday holiday, when markets in Western countries are closed.

Other US economic data

There were also information related to the income and consumption of Americans this Friday, in addition to previews of the trade balance and wholesale inventories.

February’s rose 0.3% on a monthly basis, below economists’ estimate of 0.4%, slowing down from the 1% increase seen in the previous month. It already rose 0.8% last month on a monthly basis, above the market projection of 0.5%, accelerating compared to the 0.2% increase in January. As a result, February’s monthly rose 0.4% against a 0.2% drop in January.

The previews of wholesale inventories came in above projections in February. The US economy had a goods trade deficit of US$91.84 billion in the preview, against an estimate of US$90.1 billion and larger than the deficit of US$90.51 billion in January.

They have already risen 0.5%, above the market projection of 0.2%. In January, there was a contraction of -0.3% in wholesale inventories. Excluding automobiles, it increased 0.4%, against an increase of 0.3% in January.

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