US growth strengthens as inflation accelerates
The US economy's quarterly GDP growth estimate came in at 3.4%, exceeding market expectations of 3.2% and the previous reading of 2.2%. Monthly consumer spending increased 0.5%, below the 0.6% forecast and the previous 0.9% rise. Initial jobless claims stood at 194,000, below expectations of 198,000, while the previous reading was revised upward from 194,000 to 195,000.
Annual core PCE inflation rose to 3.1%, matching expectations and exceeding the previous 3.0% reading. Headline PCE inflation increased to 3.6% year over year, up from 3.4%, while monthly core and headline PCE rose 0.3% and 0.5%, respectively. Stronger economic growth alongside persistent inflation could encourage the Federal Reserve to maintain a cautious monetary policy stance.
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