U.S. April PCE Inflation Seen Hitting 3.8% as Core Rate Climbs to 3.3%

4 articles · Updated · continuumeconomics.com · May 20

April PCE prices are forecast to rise 3.8% from a year earlier, up from 3.5% in March, while core PCE is seen edging up to 3.3% from 3.2%.
Those gains should still run cooler than April CPI because a housing-related CPI distortion and gasoline’s heavier CPI weighting are expected to have less impact in PCE data.
Consumer spending is expected to look firmer in nominal terms—helped by higher prices—but remain flat after inflation, even as retail sales rose 0.5% and services spending likely matched that pace.
Personal income is forecast to rise 0.7%, with wages and salaries up 0.5%; real disposable income would increase 0.2% and lift the savings rate to 3.9% from 3.6%.
If confirmed on May 28, the core reading would be the highest since November 2023 and leave inflation moving further from the Federal Reserve’s 2% target.

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