The core Personal Consumption Expenditures (PCE) index, which strips out the cost of food and energy, rose 2.8% over the prior year in January, the slowest annual increase since March 2021 (2.2%).
Headline PCE, which includes all categories, recorded an increase of 2.4% over last year, a slowdown from last month’s 2.6%.
Compared to the prior month, core PCE rose 0.4%, higher compared to the 0.1% increase seen in December.
The most recent minutes from the FED showed that most officials were concerned about the risks of “moving too quickly” when lowering interest rates.
Based on the latest data, analysts are now pricing in three interest rate cuts for 2024, in line with the Fed‘s most recent forecast and down from a former consensus of six cuts seen back in December.