Wednesday, 17 July 2019 00:16 WIB |
FISCAL & MONETARY |The Fed
Federal Reserve Chairman Jerome Powell said Tuesday that the central bank now estimates that a key measure of core inflation increased in June to its highest level in four months but added that, despite the acceleration, inflation pressures œremain muted.
In a speech to the Bank of France in Paris, Powell said the Fed currently estimates the change in the so-called core personal consumption expenditure (PCE) price index was 1.7% over the 12-months ended June. That is up from 1.6% in May and 1.5% as recently as March. The PCE price index is the Fed™s favorite measure of price changes.
A 1.7% annual gain in core PCE would be the highest since February. Core PCE inflation last hit the Fed™s 2% annual target last July, the first time it had hit the target since 2012.
The June estimate is remarkable mainly because it comes in advance of the official government release of the June PCE data, which won™t be made public until July 30, the first day of the Fed™s next interest-rate-setting meeting.
In his speech, Powell reiterated that the economic outlook hasn™t improved since the last Federal Open Market Committee meeting in June, setting the stage for an interest-rate cut.
Low inflation, combined with uncertainties of trade policies and global growth, œstrengthens the case for a somewhat more accommodative stance of policy, Powell said, in testimony before House and Senate committees last week.
Source : Marketwatch