USA: PCE inflation rises to +4.4% in April, 'core' at 4.7%

 
April's US Personal Consumption Expenditures (PCE) price index increased 4.4% year-on-year, an acceleration from +4.2% in March. This was revealed by the US Bureau of Economic Analysis of the Department of Commerce. On a monthly basis, the index increased by 0.4% in April for both the overall component and the 'core' component, which excludes food and energy. The year-on-year core PCE price index increased by 4.7% in April, up slightly from +4.6% in March.

According to AAA, the US Department of Labor announced on Tuesday local time that the consumer price index rose 0.1% last month (August) after holding steady in July. Meanwhile, economists had forecast that this index would decline by 0.1%. In the 12 months ending in August, the consumer price index rose 8.3%, according to the report. The annual index reached 9.1% in June, the largest increase since November 1981. Despite falling gasoline prices, US spending on rent and food continues to rise, persuading the Federal Reserve to move to raise interest rates again.

US inflation has risen at nearly the fastest pace in 40 years this year, leading to soaring consumer spending and higher costs for food, rent, medical care and other essentials, putting catastrophic pressure on segments low-income. Meanwhile, according to a Goldman Sachs survey of more than 1,500 small businesses by the Goldman Sachs 10,000 Small Business Voices, 97 percent of small business owners say inflationary pressure is as similar or worse than it was three months ago.

Additionally, 65% of them have raised their prices to offset higher costs, and 38% say they have seen a drop in demand from their customers due to the price increase. The inflation and economic pressure on the American people comes as Joe Biden's administration has contributed an estimated $15.2 billion to Ukraine since the start of the Ukrainian war.