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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
US DATA
- Core PCE inflation of 0.08% M/M in May is the first reading of the year that is consistent with inflation at or below the 2% inflation target.
- It helps leave inflation on a good track to meet the FOMC’s recently upward revised core PCE forecast of 2.8% Y/Y for 4Q24 from the June SEP.
- Indeed, inflation would average exactly 2.80% Y/Y with a monthly rate of 0.20% M/M from June onwards, implying a less troublesome 2.4% annualized over 2H24.
- That run rate would be close to the 2.3% that the median FOMC participant sees for end-2025 core PCE inflation – see chart.
- Chair Powell touched on the base effects at play on 2024 figures here. From the MNI Fed Review of the June decision: On the increase in the PCE inflation forecasts for 2024 by 0.2pp to 2.6% (headline) and 2.8% (core) despite the softer May print, and that being compatible with a rate cut later this year, Powell chalked most of the PCE acceleration up to year/year base effects, saying "if you're at 2.6% or 2.7%, that's a really good place to be."
- Most recently though, three-month core PCE inflation stood at 2.7% annualized in May despite easing from 3.5% in April, whilst the six-month rate only eased a tenth to 3.2% annualized.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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