The Federal Reserve’s key inflation gauge was slightly higher than expected in April. The Personal Consumption Expenditures (PCE) index was up 3.6% year-over-year in April, versus up 2.4% year-over-year in March. Core PCE was up 3.1% year-over-year in April versus the consensus estimate of 2.9%, up from 1.9% year-over-year in March. Nevertheless, we believe the Fed is looking through the near-term inflation data. The Fed expects “base effects” (i.e., comparing current prices to prices at the early stage of the pandemic when prices were under pressure), bottlenecks, and ongoing supply chain disruptions to cause near-term pricing pressures, but the Fed still believes these factors will largely be temporary.
US Economy Shows Signs of Moderation
July 10, 2026
July 10th, 2026 Economic data releases from the last two weeks have been mixed and market volatility picked up, primarily