March US PCE Inflation Slows but Stays Elevated

The US Personal Consumption Expenditures (PCE) Price Index rose 2.3% year-over-year in March, exceeding expectations and remaining above the Federal Reserve's 2% target. Core PCE, which excludes food and energy, increased 2.6% annually but showed no monthly growth, marking a slowdown from February’s 3% annual rise. Both personal income and spending outperformed forecasts, pointing to continued consumer strength. The stagnation in core PCE on a monthly basis has led policymakers to reassess the pace of inflation and consumer demand. These results are likely to influence market sentiment and Federal Reserve policy as core PCE remains the central bank's preferred inflation measure. Economists are watching upcoming data for further signs of inflation moderation or persistence.