PCE Inflation Holds Steady as US Household Spending Continues to Grow

The July US inflation numbers released by Action Forex show that the Personal Consumption Expenditures (PCE) Price Index rose 0.2% month-over-month, exceeding expectations of a 0.1% increase and up from -0.1% in June.

Annual headline PCE inflation held steady at 3.7%, just above the expected rate of 3.6%. Meanwhile, core PCE increased 0.2% month-over-month, matching forecasts.

Household income and spending data also showed a positive trend, with personal income growth accelerating to 0.4% from 0.2% in June, beating expectations of a 0.2% increase.

The report suggests that consumers retained some spending power despite the ongoing inflation pressure, which remains above the Fed's 2% target.