PCE Inflation Drops in November 2023, Easing Price Pressures

The core personal consumption expenditures (PCE) price index, a key inflation gauge used by the Federal Reserve, rose 0.1% in November and increased 3.2% from a year ago, slightly below economists' expectations. On a six-month basis, core PCE increased 1.9%, indicating that the Fed is nearing its inflation target. Consumer expenditures and income also rose in line with expectations, suggesting continued spending despite ongoing inflation pressures. The Fed prefers PCE as an inflation measure and has indicated it is done raising rates, with expectations of rate cuts in 2024.