- Prior was +4.6%
- PCE core MoM +0.4% vs +0.3% expected
- Prior MoM +0.3%
- Headline inflation PCE +4.4% vs +4.2% prior
- Deflator MoM +0.4% vs +0.1% prior
Consumer spending and income for April:
- Personal income +0.4% vs +0.4% expected. Prior month +0.3%
- Personal spending +0.8% vs +0.4% expected (prior +0.0%)
- Real personal spending +0.5% vs 0.0% prior
Inflation is a problem and the consumer remains red hot. The Fed is going to hike again and now the odds are 58-42% for June and July is 100% with a slight chance of another hike. At some point the Fed will have to pause and evaluate but we're lapping some very high energy numbers now and it's not enough to get inflation to a 3-handle. At minimum, the Fed needs to start seeing some monthly numbers at +0.3% or lower.
More details:
- Core services excluding housing +0.42%
- Core goods on a three-month annualized basis +2.1%