United States: New methodology trims Core PCE inflation – Wells Fargo
The post United States: New methodology trims Core PCE inflation – Wells Fargo appeared on BitcoinEthereumNews.com. Wells Fargo economists Tom Porcelli and Sarah House discuss upcoming BEA changes to the Personal Consumption Expenditures (PCE) Price Index that will affect data from 2021 onward. They estimate the new methodology will lower current core PCE by about 0.2 percentage points, bringing May’s rate near 3.2% versus 3.4% published, but still roughly 1 percentage point above the Federal Reserve’s (Fed) 2% target. Method tweaks modestly lower core PCE “We want to flag a few methodology changes that are being made to the Fed’s preferred measure of inflation, the PCE price index. The changes will be rolled out in the BEA’s annual update on September 30 and will impact data from 2021 onward.” “We expect the changes will shave only about 0.2 percentage points off the current y/y run-rate of core PCE. So the impact on actual inflation looks to be modest, but the changes are welcome jus