Personal Consumption Expenditures (PCE) came in as expected. Inflation rose by 0.3%. The year-over-year inflation also remained the same at 2.7%. A significant part of that was due to the increase in energy costs. We had expected a decline in inflation.

Let’s take a closer look at these numbers. The core rate, which excludes food and energy costs, rose by 0.2%, but it actually increased by 0.249%, rounded down to 0.2%. The year-over-year inflation number is not 2.7% but actually 2.75%, again rounded down.

The larger question is why are we looking that closely? If you are going to win, win big. Swimming competitions can come down to 1/100th of a second. Do you know what that is? That’s two coats of paint.

Inflation is no longer trending upwards, and we anticipate it will decline as the year progresses.

Rates continue to improve this week. Have a great weekend and enjoy the Sun.