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Fed's PCE Inflation Data Tonight: Will Inflation Stabilize or Surge?

Coin WorldFriday, Jan 31, 2025 6:20 am ET

1min read

The Federal Reserve's preferred Personal Consumption Expenditures (PCE) inflation data, which is closely watched by the central bank, is set to be released tonight at 9:30 PM. This data is expected to provide valuable insights into the current state of inflation in the United States.

European Central Bank (ECB) board member Philip Lane recently expressed confidence that inflation will stabilize at the target level as expected. Lane stated that monetary policy will no longer be restrictive in the near future, estimating that this could happen during the spring and summer.

The PCE inflation data is a key indicator for the Federal Reserve in its decision-making process regarding monetary policy. The data is expected to show whether inflation has stabilized or if it continues to rise. If inflation remains high, the Federal Reserve may consider further rate hikes to combat it.

Investors and economists will be closely watching the PCE inflation data release tonight. The data could have significant implications for the financial markets and the broader economy. If inflation is seen to be under control, it could lead to a more optimistic outlook for the economy and potentially boost stock prices. However, if inflation remains high, it could lead to further uncertainty and volatility in the markets.

The PCE inflation data is a core measure of inflation that excludes food and energy prices. It is considered a more stable measure of inflation than other indicators, such as the Consumer Price Index (CPI). The PCE inflation data is also favored by the Federal Reserve because it is more closely tied to the central bank's mandate to promote maximum employment and stable prices.

In recent months, inflation has been a major concern for central banks around the world. The ECB, for example, has been raising interest rates to combat inflation and bring it back down to its target level of 2%. The Federal Reserve has also been raising interest rates, with the federal funds rate currently at 4.5%.

The PCE inflation data release tonight will be an important milestone in the ongoing battle against inflation. Investors and economists will be closely watching the data to see if inflation has stabilized or if further action is needed to bring it under control.

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