Energy-price surge tied to Iran tensions lift helped U.S. PCE inf as real
consumer spending rose 0.1% in April, the Bureau of Economic Analysis said
Thursday. The PCE price index was up 3.8% YoY, the highest since 2023; core PCE
(ex food and energy) rose 3.3% YoY. Separately, Q1 GDP was revised down to a
1.6% annualized pace after cuts to inventory investment and consumer spending,
below the prior estimate. These readings could strengthen calls among Fed
officials to signal the next move may not be a cut; new Fed chair KEVIN WARSH
may need to work to convince colleagues that reining in inf expectations does
not necessarily require further rate hikes.
