Fed’s preferred inflation gauge ticks higher in June

[mystery-ak]

 Fed’s preferred inflation gauge ticks higher in June
by Julia Shapero - 07/26/24 8:35 AM ET



The Federal Reserve’s preferred gauge of inflation rose slightly in June, according to new data from the Commerce Department released Friday.

The personal consumption expenditures (PCE) price index rose 0.1 percent last month and 2.5 percent over the past year. Core PCE, which excludes more volatile food and energy prices, was up 0.2 percent in June and 2.6 percent year-over-year.

The latest inflation reading comes as the Fed is set to meet next week. The central bank has held interest rates steady at a range of 5.25 to 5.5 percent for the past year, as inflation has remained stubbornly above its 2 percent target.

After peaking at a 40-year high in mid-2022, inflation has eased significantly. However, recent inflation data has showed halting progress, especially in the first quarter of 2024.

With several better inflation readings in the second quarter, Fed Chair Jerome Powell said earlier this month that the central bank is gaining more confidence that inflation is sustainably moving toward 2 percent.

“I would say we didn’t gain any additional confidence in the first quarter, but the three readings in the second quarter … do add somewhat to confidence,” Powell said during remarks at The Economic Club in Washington, D.C., in mid July.

Another measure of inflation, the consumer price index (CPI), has also shown further signs of easing in recent months. The CPI fell 0.1 percent in June, marking the first time that consumer prices have fallen month-to-month since the pandemic.

At the same time, the labor market appears to be cooling, fueling hopes of interest rate cuts. The unemployment rate ticked up slightly to 4.1 percent in the June jobs report, and the Labor Department made significant downward revisions to April and May’s job gains.

Even as inflation is easing and the job market is cooling, the U.S. economy has remained remarkably strong. Gross domestic product (GDP) grew at an annualized rate of 2.8 percent in the second quarter, coming in well above economists’ expectations, according to data released Thursday.

https://thehill.com/business/4793252-federal-reserve-inflation-gauge/

[mystery-ak]

Breitbart Business Digest: Growth and Inflation Are Too Hot for the Fed to Cut in September

John Carney 25 Jul 2024

Economic Growth Rips Higher Than Expected

Economic growth picked up more than expected in the spring, not only undermining the case for rate cuts but also raising the possibility that the Federal Reserve still has not done enough to cool the economy off to bring inflation down to its two percent target.

The Bureau of Economic Analysis said Thursday that real gross domestic product (GDP) expanded at a 2.8 percent annual rate in the second quarter. That is twice the pace of the 1.4 percent recorded in the first quarter of the year and significantly stronger than the two percent consensus forecast.

Consumer spending, the engine of the U.S. economy, rose at a 2.3 percent annual rate in the April through June period, matching the rate of growth in the first quarter and defying expectations for a slowdown. This contributed about 1.6 percentage points to growth.
Durable Goods Consumption Is Back to Growth

The rotation away from goods that had weighed on the manufacturing sector has run its course. Goods purchases rose 2.5 percent, an acceleration from the previous quarter’s 1.5 percent growth rate. Nondurable goods consumption flipped from a 1.1 percent contraction to a 1.4 percent expansion. After adjusting for inflation, households spent more on food, beverages, gasoline, and energy, and less on clothing and footware.

Durable goods spending was even more impressive, climbing at a 4.7 percent rate. Spending on cars and trucks made a positive contribution to GDP growth for the first time following four consecutive quarters of being a drag. Furniture and appliance spending made their largest contribution to growth since the first quarter of 2021 after being flat in the first quarter of this year and near flat in the fourth quarter of last year.

more
https://www.breitbart.com/economy/2024/07/25/bbd-q2-gdp-no-cut/

[Bigun]

https://www.youtube.com/watch?v=AAPGijDFJiQ

[LMAO]

We need Paul Vockler and Calvin Coolidge

Vockler raised  interest rates really high and put the country in recession to tighten the money supply and we need Coolidge or Milei types  to slash the budget


 

[LMAO]

Does anybody believe that either candidate would be ok with the Vockler medicine to fight inflation on their watch…..?

[jafo2010]

We are being spent blind, and no one in Washington is attempting to reign in the spending.  NO ONE!!!

Inflation is headed one direction long term with the Democommies....UP  UP  UP!!!

First off, they intend to shutoff our sources of energy, making us more dependent or foreign energy.  They will continue to raise the cost UP  UP  UP.

Car sales will have to decline, because the majority of the population cannot afford an EV, and there is virtually no after market for EVs.  And that market will get saturated, with all those intending to get an EV having one. 

I am shopping for a new vehicle right now, and I would not even consider looking at an EV.  They are grossly overpriced.  If the federal government wasn't subsidizing the EV market, their sales would dry up and go away.

In essence, they are choking the economy to death, and they are clueless. Watch for huge numbers to become unemployed in the USA. 

[Hoodat]

Even as inflation is easing and the job market is cooling, the U.S. economy has remained remarkably strong. Gross domestic product (GDP) grew at an annualized rate of 2.8 percent in the second quarter, coming in well above economists’ expectations, according to data released Thursday.

In the last quarter, our GDP increased $200 billion (to be adjusted downward in a month).  Meanwhile, our national debt increased $500 billion.  Let that sink in.  Our government printed up $500 billion in new money just to fund itself, but our entire US economy can't keep up with what they 'borrow'.  Not to mention that it's the $500 billion they added that is fueling inflation.  We are so screwed.

[Hoodat]

Does anybody believe that either candidate would be ok with the Vockler medicine to fight inflation on their watch…..?

The Volcker model is based on the premise that government must borrow from existing money in order to fund any shortfall (which is what will drive up interest rates).  The foundation of that model was completely abandoned in 2009.  Interest rates are now arbitrary and are not at all based on demand for capital.

[roamer_1]

Car sales will have to decline, because the majority of the population cannot afford an EV, and there is virtually no after market for EVs.  And that market will get saturated, with all those intending to get an EV having one. 

More then that, they didn't make enough ICE engined vehicles to compensate for the EV vehicles that won't sell. That means shortage, which will put weight on the 5 year and newer used market, driving that out of reach, which means more shortage sommore. Which puts weight on the older used rigs... so the whole sector will go wanting, driving prices up all the way around.

I think I'd hold off buying for a while.

[Drago]

Any government "boasting" about the GDP is laughable! Federal govt. spending (DEBT & taxes) are at least 35% of GDP (up to 47% recently).

https://tradingeconomics.com/united-states/government-spending-to-gdp