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MS On Core PCE Implications

US OUTLOOK/OPINION
  • Post CPI, Morgan Stanley preliminarily forecast core PCE inflation at 0.35% M/M in May vs. 0.38% in April (to be released Jun 30).
  • While their estimate of core services ex housing and medical in the CPI report stepped up from 0.20% to 0.34% M/M, the preliminary forecast for core services ex housing and medical for PCE is to tick down from 0.39% to 0.37% M/M in May.
  • Finalized tomorrow after PPI.

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