PCE hits consensus. Instantaneous (weighted average of m/m inflation, with more recent observations having higher impact) headline and core down.

Figure 1: Instantaneous PCE inflation (T=12, a=4) per Eeckhout (2023) for PCE (blue), chained core CPI, seasonally adjusted by author using X-13 (tan), PCE deflator (pink), CPI supercore (teal), PPI core (light green).May PCE core for May is Cleveland Fed nowcast as of 6/13. Source: BLS, BEA via FRED, BLS, Cleveland Fed, and author’s calculations.

Instantaneous core is now at target.

While PCE and core PCE m/m inflation were at consensus, they were both below Cleveland Fed nowcasts.

Source: Cleveland Fed, accessed 6/28/2024.

Here’s an updated picture of core measures.

Figure 2: Instantaneous inflation (T=12, a=4) per Eeckhout (2023) for core CPI (blue), chained core CPI, seasonally adjusted by author using X-13 (tan), PCE deflator (pink), CPI supercore (teal), PPI core (light green).Source: BLS, BEA via FRED, BLS, and author’s calculations.

Now, for sure, we know all core measures are down in May.

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