News about interest rates, Fed

Core PCE inflation came in above the Fed's target for the 4th straight month. But it moderated from Q1 and the elevation was entirely due to imputed portfolio fees resulting from the strong stock market. Annual rates: 1 month: 3.0% 3 months: 3.5% 6 months: 3.2% 12 months: 2.8% pic.twitter.com/FHtSAVejI6

High Interest Rates Are Working, Fed's Williams Says “…sees inflation, as measured by PCE price index, falling to about 2.5% by the end of this year before moving closer to 2% next year. He sees the unemployment rate reaching about 4% at year end” www.bloomberg.com/news/articles/2024-05-30/fed-s-williams-says-ample-evidence-that-policy-is-restrictive

Soft evidence on inflation: the Fed’s latest Beige Book says “Prices increased at a modest pace.” In Jan. 2020 it said “Prices continued to rise at a modest pace.” Consistent with the view that the inflation bump is over.

The message in today’s release of the Fed’s preferred inflation measure, the personal consumption expenditure deflator, is that inflation is on track to be within spitting distance of the Fed’s 2% target by year’s end. Harmonized core PCE, which is the best measure of underlying…