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Core PCE at 3.4 Percent What the Feds New Inflation Signal Means
Season 2
Episode 77
Published 2 weeks ago
Description
Core PCE inflation hit 3.4% in May, the highest since October 2023, just as the Fed signals rate cuts later this year. Lucas and Luna unpack the May Core PCE number, what it means for the Fed's credibility on inflation forecasting, and why the FOMC might still cut rates despite sticky inflation. They explore the Fed's own admission that its models have trouble predicting inflation, and whether the 3.4% reading changes the path for rate cuts in 2026. Drawing on the latest dot plot and Fed commentary, they discuss how the committee balances upside inflation surprises with downside growth risks, and what it means for markets. No jargon, just clear analysis.