US consumer spending held up in April as the Federal Reserve’s preferred inflation measure moderated last month, as policymakers remain on track to tighten more aggressively to relieve pressure on American households.
The core personal consumption expenditures (PCE) price index — an underlying gauge of inflation, which excludes the volatile food and energy segments — increased 4.9 per cent on a yearly basis in April, the commerce department said on Friday, down from 5.2 per cent the previous month.
That figure represents a cooling of the pace of inflation, which in February was growing at its fastest rate in four decades. Analysts polled by Refinitiv forecast that the core PCE would rise 4.9 per cent in April.
Still, annual inflation readings have been expected to fall as they lap the very elevated levels logged last year, however, Friday’s report showed on a month-on-month basis core PCE rose 0.3 per cent, little changed from March.