Inflation in the United States displayed signs of cooling off in May, marking the lowest increase since March 2021. Recent data reveals that the main Personal Consumption Expenditures (PCE) index, which excludes volatile food and energy costs, only rose by 0.1% in May compared to the previous month. This aligns with analysts’ predictions and indicates a slowdown from the 1.0% increase recorded in April.
The PCE index is a crucial metric for the Federal Reserve, as it guides the adjustment of monetary policies. With the annual increase in core PCE reaching 2.6% in May, experts view this as a positive development.
The report is part of a series of data indicating a trend towards a deceleration in inflation. For instance, the Consumer Price Index (CPI), another significant indicator, reported a 0.2% increase in May, falling below economists’ expectations.
Despite these recent favorable developments, the Federal Reserve remains cautious. In a recent statement, it emphasized that interest rate cuts will only be considered once there is “greater confidence” in the trajectory of inflation.
Jerome Powell, the president of the Fed, addressed the issue during a press conference on June 12th, stating, “There has been modest progress toward our inflation target.” Powell added that more positive data is required to strengthen their confidence that inflation is sustainably moving towards 2 percent.
In other news, at the time of publication, the price of BTC was quoted at US$60,878.19, experiencing a 1% decrease in the last 24 hours.
Disclaimer: The opinions expressed in this article, whether by the author or any individuals mentioned, are solely for informational purposes and do not constitute financial, investment, or other advice. Investing or trading cryptocurrencies carries the risk of financial loss.
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