#USMayPCEInflationRisesTo4.1%HighestIn3Years


The forecast for a sharp deceleration in PCE inflation from May through August does not align with the latest official data. The actual figures for May show inflation accelerated, reaching its highest level in three years. This confirms market expectations that the May report represented a peak in inflationary pressure from surging crude oil.
According to the U.S. Bureau of Economic Analysis (BEA), the headline PCE price index rose to 4.1% year-over-year in May, up from 3.8% in April. On a monthly basis, it increased by 0.4%. The core PCE, which excludes volatile food and energy prices, also rose to 3.4% year-over-year, its highest level since late 2023.
While this inflationary surge is a significant development, some economists believe it may be a peak driven largely by energy prices from the Middle East conflict. Given the subsequent sharp decline in oil prices, there is an expectation that the headline inflation rate could decrease in the June data. However, the core inflation reading at 3.4% is seen as more persistent and may not retreat as easily.
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
  • Reward
  • 4
  • Repost
  • Share
Comment
Add a comment
Add a comment
GateUser-e6dafce6
· 1h ago
Core PCE at 3.4% is so sticky; falling energy prices don't help either—service inflation is the tough nut to crack.
View OriginalReply0
MorningGoldAsWavesCrashAgainst
· 2h ago
PCE exceeded expectations again, and the expectation of Fed rate cuts is likely to be pushed back. Tightening liquidity is unfavorable for risk assets.
View OriginalReply0
GateUser-9335da8b
· 3h ago
The May data debunked the narrative of 'rapid inflation decline', but oil prices have already collapsed. Will June look better?
View OriginalReply0
TacoTreasury
· 4h ago
These numbers come out, US Treasury yields will jump again, crypto faces short-term pressure, wait until July CPI to see the direction.
View OriginalReply0
  • Pinned