#PCEInflationWatch January 2025 Update

The latest Personal Consumption Expenditures (PCE) Price Index report shows that inflation remains a key concern for policymakers and markets. The core PCE, which excludes volatile food and energy prices, remains the Federal Reserve’s preferred inflation gauge. While recent data suggests a gradual easing of inflationary pressures, it remains above the Fed’s 2% target, keeping rate-cut expectations uncertain.

Consumer spending trends indicate resilience despite higher borrowing costs, with services inflation staying elevated. The Fed will likely analyze upcoming employment and wage data before making policy decisions. Markets are closely watching for signs of a policy shift, but for now, monetary tightening remains in focus.

Will the Fed pivot in 2025? Stay tuned for more updates!