No improvement in PCE inflation index

The Federal Reserve prefers the personal consumption expenditures (PCE) index to the Consumer Price Index (CPI). The Fed has a target of 2% inflation in the PCE index.

Friday, October 28, 2022
The PCE price index increased 0.3 percent in September. Excluding food and energy, the PCE price index increased 0.5 percent.

Disposable personal income (DPI) increased $71.3 billion (0.4 percent) and personal consumption expenditures (PCE) increased $113.0 billion (0.6 percent). [Note that spending is growing faster than income, which is stimulating the economy.]

Price indexes: Percent change from month one year ago

      May       June        July        Aug     Sept
  PCE 	6.5 	 7.0         6.4       6.2 	   6.2
 PCE,  	4.9  	5.0  	     4.7  	   4.9 	   5.1

excluding food and energy

[end quote]

This pretty much guarantees that the Fed will raise the fed funds rate 0.75% in November and at least 0.5% in December. There is no evidence that their rapid tightening has reduced inflation significantly so far, if at all.

Wendy (can’t figure out how to align the table in the post. I tried using spaces and also < pre> like I used in the old system but they didn’t work)


someone previously shared this (Markdown Cheat Sheet | Markdown Guide) or just search “markdown guide”

see section on tables (Extended Syntax | Markdown Guide)



It is all about the IRA in 2023 and the results of the IRA going forward from 2024.