The Personal Consumption Expenditures (PCE) price index — the Federal Reserve's preferred assessment of how quickly prices are rising across the economy — rose 0.6% in January and 5.4% from the previous year, according to data released on Friday. Excluding the components of food and energy which can fluctuate greatly, core prices increased 0.6% in the month and 4.7% compared to the same month last year.
The release of the personal consumption expenditure (PCE) price index early Friday showed the cost of U.S. goods and services jumped 0.6% in January, its biggest rise since last summer. This is another sign that stubbornly high inflation is taking its time to return to low prepandemic levels.
The 10-year U.S. Treasury yield ticked lower to 3.87% on Thursday, falling for a second consecutive session. However, the 10-year yield moved higher to 3.94% this morning — on track for a fifth-straight weekly advance — after the hot inflation report.
At 9:51 a.m. EST, the S&P 500 (SP500) was down 1.6%, the Nasdaq Composite (COMP.IND) was off 1.7%, and the Nasdaq 100 (NDX) was down 1.4%. The Dow (DJI) was seeing the most downward pressure, off 2%.
Other important economic readings are due before the bell. It is anticipated that personal income in January will increase by 1.2% compared to the preceding month, whereas the same metric had only grown by 0.2% in December. Consumer spending is forecasted to increase by 1.4% in January, up from a decline of 0.2% the prior month.
The other data scheduled for release today at 10 a.m. EST is the existing home sales report for January. The sales of existing homes increased by 2% from the previous month, totaling 4.10 million units.
Minutes from the Federal Reserve's last meeting on Jan. 31 and Feb. 1 published on Wednesday showed that while there were signs of inflation easing, central bank officials were still concerned about rising prices. It was also indicated that additional increases in interest rates are probable.
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