Fed's Goolsbee Keeps Policy Focus on PCE after High Consumer Price Readings
Chicago Federal Reserve President Austan Goolsbee said Friday continued high consumer price index readings were concerning, but he remains focused on how the Fed's targeted personal consumption price expenditures index behaves. "We've had multiple inflation readings that were higher than we wanted" for the CPI, Goolsbee said on Fox Business, but PCE "is the better measure...If we start getting better readings that show us that arc of inflation coming down...
The central bank sets its 2% inflation target using the separate PCE price index, which is based on the same consumption data used to calculate gross domestic product, and therefore weights things like housing and healthcare costs differently than the CPI, which is based on a survey of consumer spending on a defined basket of goods and services.
But his comments do show the influence coming data releases will have on Fed policy, even among those who tended to be more optimistic that inflation will continue falling.
Inflation Personal Consumption Expenditures Cpi
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