High inflation in the US. How does the dollar feel?
May 2, 2023 3:23 am
Thanks to the Friday report on personal consumption expenditures (PCE) for March, published by the Bureau of Economic Analysis (BEA), the Federal Reserve received clear data indicating that inflation remains high for now, but its growth is slowing down both in monthly and annual terms.
The report states that consumer personal income increased by $67.9 billion in March 2023, which was 0.3%.
For the month, PCE increased by only 0.1% and 4.2% for the year. This is 0.8% lower than in February when the annual figure was 5%. This was significantly lower than economists’ expectations, who thought that annual inflation would be 4.6%.
Compared to the previous month, the core PCE increased by 0.3%. And by 4.6% compared to the same period last year, while in February it decreased from 4.7% by 0.1%.
The core PCE does not include energy and food costs and is the preferred inflation indicator of the Federal Reserve System.
Economists forecast that the core PCE indicator compared to last year should have been lower at 4.5%.
Following this report, according to the CME FedWatch tool, the probability increased that at the FOMC meeting, which will take place this week, the Federal Reserve will implement its 10th consecutive rate hike, raising them by a%. The probability increased from 83.9% to 85%.
After the report data was released, the dollar rose slightly, only by 0.18%. And leaving for the weekend, it was fixed at the level of 101.64.
The material has been provided by InstaForex Company – www.instaforex.com
Thanks to the Friday report on personal consumption expenditures (PCE) for March, published by the Bureau of Economic Analysis (BEA), the Federal Reserve received clear data indicating that inflation remains high for now, but its growth is slowing down both in monthly and annual terms.
The report states that consumer personal income increased by $67.9 billion in March 2023, which was 0.3%.
For the month, PCE increased by only 0.1% and 4.2% for the year. This is 0.8% lower than in February when the annual figure was 5%. This was significantly lower than economists’ expectations, who thought that annual inflation would be 4.6%.
Compared to the previous month, the core PCE increased by 0.3%. And by 4.6% compared to the same period last year, while in February it decreased from 4.7% by 0.1%.
The core PCE does not include energy and food costs and is the preferred inflation indicator of the Federal Reserve System.
Economists forecast that the core PCE indicator compared to last year should have been lower at 4.5%.
Following this report, according to the CME FedWatch tool, the probability increased that at the FOMC meeting, which will take place this week, the Federal Reserve will implement its 10th consecutive rate hike, raising them by a%. The probability increased from 83.9% to 85%.
After the report data was released, the dollar rose slightly, only by 0.18%. And leaving for the weekend, it was fixed at the level of 101.64.
The material has been provided by InstaForex Company – www.instaforex.com
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