US March PCE Price Index Up 2.7% Year-on-Year... Early Rate Cut Moves Further Away (Update)

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The Personal Consumption Expenditures (PCE) price index, a key indicator for the U.S. Federal Reserve's (Fed) policy decisions, slightly exceeded market expectations last month.

On the 26th (local time), the U.S. Department of Commerce announced that the March PCE price index rose 2.7% year-over-year. This is 0.2 percentage points higher than the previous month and 1 percentage point higher than the Bloomberg forecast of 2.6%. The core PCE, which excludes the volatile energy and food and beverages sectors, increased 2.8% year-over-year, the same as last month.

Earlier, the U.S. Q1 PCE price index was reported to have risen 3.4% year-over-year, a sharp increase from 1.8% in Q4 of last year. As inflation remains high, concerns are emerging that expectations for an early rate cut by the Fed will significantly diminish.