United States December PCE inflation is a rise in support of the Federal Reserve

(Reuters) – The US prices rose in December while spending on consumer increased, indicating that the federal reserve could delay the reduction of interest rates for some time this year.

The Ministry of Commerce said on Friday that the PIN Expenditure Index (PCE) increased by 0.3 % last month after a 0.1 % unlike profit in November. Reuters economists had expected the PCE price index to climb 0.3 %. In 12 months to December, the PCe price index offered by 2.6 % after an increase of 2.4 % in November.

The US Central Bank traces PCE price measures for monetary policy.

Market reaction:

Stocks

Bonds: The return in the United States was transferred for 10 years to 4.523 %, and the return increased for two years by 4.207 %

Forex: The dollar index that held the company, an increase of 0.157 %

comments:

Peter Cardilo, Chief Economist in the Market

“Basically on a monthly basis, inflation was slightly higher than I expected.

“Basically, the needle does not change much. It is a mixed report, and plays in the hands of the Federal Reserve in that the Federal Reserve needs more emphasis that inflation is going in the right direction.

“The bottom line is that this report will not have a significant impact on the markets in either direction. The tariff situation is what is on the confrontation line and you just have to wait and see … We may bear a surprise, and that may be just less than the 25 % that he talks about Trump.

Gennadiy Goldberg, Head of the US Prices Strategy, TD Securities, New York

It is an interesting set of data for markets. The very strong personal income spending data continues to indicate that the consumer is still flexible. At the same time, you have an inflating pressure that continues to fade. Before approximation, it was 0.156 % (the basic PCE increase per month), so it is actually a very positive number, I would like, for the price market. It really confirms that the Federal Reserve can maintain prices, at least for the next meeting or so if data like this continues, and we actually believe that the Federal Reserve can maintain rates for a longer period, along the first half of the year. “

Kyle Chapman, Foreign Currency Market Analyst, Palinger Group, London

“The data indicates the direction for the US prices that still indicate the bottom, but also confirm that the Federal Reserve is right to start a temporary suspension. Although 2.8 % is clearly higher than the goal, we will see some rapid gains on the annual number Throughout the year during the next few months, the rise in the first quarter of last year fades.

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