Inflation in the US eased in January, but the Fed signals patience before considering interest rate cuts
by Freschia Gonzales
Wealth Professional
The latest US economic data indicates that inflation eased slightly in January, but consumer spending fell unexpectedly, raising concerns about economic momentum.
According to the US Commerce Department, the personal consumption expenditures (PCE) price index, the US Federal Reserve’s preferred inflation measure, increased by 0.3 percent for the month, bringing the annual rate to 2.5 percent.
Core PCE, which excludes food and energy, also rose by 0.3 percent in January and was up 2.6 percent year-over-year, marking a decline from December’s revised 2.9 percent.
Despite cooling inflation, US consumer spending dropped by 0.2 percent in January, the largest monthly decline since February 2021, as reported by CNN.