US inflation data for April showed some moderation in monthly price pressures, though the broader annual trend continued pointing higher as the Federal Reserve remains focused on persistent inflation risks. The headline PCE price index rose 0.4% mom, slightly below expectations of 0.5% mom. The Fed’s preferred inflation gauge, Core PCE, which excludes food and energy, increased 0.2% mom, also softer than the expected 0.3% mom reading.
However, annual inflation measures continued accelerating. Headline PCE rose from 3.5% yoy to 3.8% yoy, while core PCE edged up from 3.2% yoy to 3.3% yoy, both matching expectations.
The data reinforces the Fed’s growing concern that higher energy costs tied to the Middle East conflict are continuing to filter through broader inflation dynamics even as monthly momentum shows occasional moderation.
Elsewhere in the report, personal income unexpectedly slipped slightly in April, missing expectations for a solid 0.4% mom increase, while consumer spending remained relatively firm with a 0.5% mom gain.
| Indicator | Previous | Forecast | Actual |
|---|---|---|---|
| Headline PCE (MoM) | 0.3% | 0.5% | 0.4% |
| Core PCE (MoM) | 0.2% | 0.3% | 0.2% |
| Headline PCE (YoY) | 3.5% | 3.8% | 3.8% |
| Core PCE (YoY) | 3.2% | 3.3% | 3.3% |
| Personal Income (MoM) | 0.2% | 0.4% | -0.1% |
| Personal Spending (MoM) | 0.6% | 0.5% | 0.5% |
