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Kenny Polcari, chief market strategist at SlateStone Wealth, addresses “nervousness” over Trump’s expected tax cuts in “Varney & Co.”
The Federal Reserve’s favorite inflation gauge was lower than expected in November, but still remains above the central bank’s target level as its efforts to reduce inflation continue.
The Commerce Department reported Friday that the personal consumption expenditures (PCE) index rose 0.1% in November and 2.4% year over year. Both fell short of estimates by FactSet economists.
Core PCE, which excludes volatile food and energy prices, rose 0.1% on the month and was up 2.8% from a year ago, also less than expected.
U.S. stocks posted mixed results following the data in what is a volatile trading week ahead of the shortened holiday trading week.
| Heart | Security | Last | Change | Change % |
|---|---|---|---|---|
| Me: DJI | DOW JONES AVERAGES | 44782 | -128.65 |
-0.29% |
| SP500 | S&P 500 | 6047.15 | +14.77 |
+0.24% |
| Me: COMP | NASDAQ COMPOSITE INDEX | 19403.947849 | +185.78 |
+0.97% |
Still, the headline PCE of 2.4% rose slightly from 2.3% in October and 2.1% in September, suggesting inflation remains sticky.
WHY EGG PRICES STILL SO EXPENSIVE
The Federal Reserve is focusing on the headline PCE figure as it tries to slow the pace of price increases to 2%, although policymakers view the core data as a better indicator of inflation.
Federal Reserve Chairman Jerome Powell speaks during a press conference following a meeting of the Federal Open Market Committee at the Federal Reserve in Washington, DC, on Wednesday. (Alex Wong/Getty Images/Getty Images)
The Federal Reserve cut rates by 25 basis points this week and Fed Chair Jerome Powell reiterated the importance of the incoming data.
THE FED CUT RATES AGAIN IN DECEMBER
“We know that reducing policy restrictions too quickly or too much could hamper progress on inflation. At the same time, reducing policy restrictions too slowly or too little could unduly weaken economic activity and employment. And given the scope and timing of additional adjustments to the target range for the federal funds rate, the committee will evaluate the incoming data, the evolving outlook and the balance of risks. We are not on any pre-set course in our summary of economic projections,” he said during his speech. press conference.
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Consumption or personal spending increased 0.4% less than estimates, but equal to the previous month. Revenue, however, was 0.4% lower than the previous reading of 0.6%.
