Inflation and core PCE higher than expected, consumer spending decreases, Fed likely to maintain rates

From Investing.com: 2025-06-27 12:51:00

Inflation rose to 2.3% in May, ending three months of declines, according to the U.S. Bureau of Economic Analysis. Core PCE inflation also increased to 2.7%, higher than expected. Consumer spending fell by $29.3 billion, with a drop in goods spending offset by an increase in services spending. Personal income dropped by $109.6 billion, below expectations. The Fed’s preferred inflation measure is projected to average 3.1% in 2025, leading to consumer pessimism and decreased spending. Market indexes were mostly up in response to the news, but expectations of a rate cut in July slightly decreased.



Read more at Investing.com: Core PCE Surprise Rekindles Fed Patience as Consumer Spending Softens