US Inflation Slows, Boosting Prospects for Fed Rate Cuts
Latest PCE data shows smallest increase in six months, reinforcing bets on policy easing this year.
Overview
- Core PCE index rose just 0.1% in May, the smallest advance since November 2020.
- Annual increase in core PCE was 2.6%, the lowest since early 2021.
- Stock futures rose and bond yields fell as markets anticipate rate cuts.
- Consumer spending increased moderately, driven by higher incomes.
- Fed officials signal cautious optimism but await further data before committing to cuts.