US PCE inflation rises less than expected
US inflation fell in February, according to data released on Friday by the Commerce Department.
The price deflator for personal consumption expenditures rose 0.3% on the month, following a 0.6% increase in January. This was below expectations of 0.5%.
On the year, the index rose 5.0% in February, down from 5.3% growth in January. Analysts were expecting a print of 5.1%.
Core PCE - the Federal Reserve’s preferred gauge of inflation - also fell to, 4.6% on the year from 4.7% . On the month, core PCE was 0.3%, down from 0.5% (consensus: 0.4%).
The figures also showed that consumer spending ticked up 0.2% on the month in February, down from 2% the month before.
The personal savings rate, which is measured in proportion to disposable personal income, rose from 4.4% for February to 4.6% in March.
Paul Ashworth, chief North America economist at Capital Economics, said: "Fed officials will be slightly encouraged by the 0.3% m/m increase in the core PCE deflator, with January’s gain trimmed to 0.5%, from 0.6%.
"Nevertheless, inflation remains too high, with the annual and three-month-annualised rates both above 4.5%."