Investing.com – The U.S. core personal consumption expenditure index rose slightly more-than-expected in December, while personal spending stagnated, official data showed on Monday.
In a report, the Bureau of Economic Analysis said its seasonally adjusted core PCE price index rose by 0.2% in December, above expectations for a modest 0.1% increase and up from a reading of 0.1% in November.
The core PCE price index rose at an annualized rate of 1.8% in December, in line with expectations, after rising at a rate of 1.7% in the preceding month.
The Federal Reserve uses core PCE as a tool to help determine whether to raise or lower interest rates, with the aim of keeping inflation at a rate of 2% or below.
The report showed that personal spending was flat in December, confounding expectations for a 0.2% gain. Personal spending for November rose by an unrevised 0.1%.
Consumer spending is the single biggest source of U.S. economic growth, accounting for as much as two-thirds of economic activity.
Personal income rose by 0.5% last month, beating expectations for a 0.4% gain, after rising by an unrevised 0.1% in November.
Following the release of the data, the U.S. dollar remained higher against the euro, with EUR/USD dropping 0.93% to trade at 1.3097.
Meanwhile, U.S. equity markets held on to losses following the data. The Dow Jones Industrial Average futures indicated a loss of 0.65%, S&P 500 futures fell 0.75%, while the Nasdaq 100 futures shed 0.8%.
In a report, the Bureau of Economic Analysis said its seasonally adjusted core PCE price index rose by 0.2% in December, above expectations for a modest 0.1% increase and up from a reading of 0.1% in November.
The core PCE price index rose at an annualized rate of 1.8% in December, in line with expectations, after rising at a rate of 1.7% in the preceding month.
The Federal Reserve uses core PCE as a tool to help determine whether to raise or lower interest rates, with the aim of keeping inflation at a rate of 2% or below.
The report showed that personal spending was flat in December, confounding expectations for a 0.2% gain. Personal spending for November rose by an unrevised 0.1%.
Consumer spending is the single biggest source of U.S. economic growth, accounting for as much as two-thirds of economic activity.
Personal income rose by 0.5% last month, beating expectations for a 0.4% gain, after rising by an unrevised 0.1% in November.
Following the release of the data, the U.S. dollar remained higher against the euro, with EUR/USD dropping 0.93% to trade at 1.3097.
Meanwhile, U.S. equity markets held on to losses following the data. The Dow Jones Industrial Average futures indicated a loss of 0.65%, S&P 500 futures fell 0.75%, while the Nasdaq 100 futures shed 0.8%.