Slowdown of the Fed’s inflation indicator

The US Department of Commerce announced data on personal income and consumer spending for October.

Consequently, personal income in the country increased by 0.2 percent in October compared to the previous month. During this period, the growth of Americans’ personal income, which was in line with market expectations and recorded the lowest increase in four months, was 0.4 percent in September.

Personal consumption expenditures also rose 0.2 percent month-on-month in October, in line with expectations.

Personal consumption expenditures, which registered the lowest increase in five months in October, rose 0.7 percent in September.

DECREASE IN BASIC DATA

While the price index for personal consumption expenditures remained unchanged month-on-month in October, it rose 3 percent year-on-year.

In that period, the price index of personal consumption expenditures was expected to increase by 0.1 percent monthly. The index increase was in line with annual expectations and recorded its lowest level since March 2021.

The price index of personal consumption expenditures rose 0.4 percent month-on-month and 3.4 percent year-on-year in September.

The core price index of personal consumption expenditures, which excludes food and energy items that the US Federal Reserve (Fed) considers an indicator of inflation, rose 0.2 percent month-on-month and 3.5 percent annually in the same period.

The core personal consumption expenditure price index, which rose in line with market expectations, rose 0.3 percent month-on-month and 3.7 percent year-on-year in September.

Analysts said data on personal consumption spending points to cooling demand, which may further reinforce expectations that the Federal Reserve has ended interest rate hikes. (AA)