Inflation rate slipped to 2.1% in April, lower than expected, Fed's preferred gauge shows

[BumRushDaShow]

Source: CNBC

Published Fri, May 30 2025 8:33 AM EDT | Updated 2 Min Ago


Inflation barely budged in April as tariffs President Donald Trump implemented in the early part of the month had yet to show up in consumer prices, the Commerce Department reported Friday.

The personal consumption expenditures price index, the Federal Reserve’s key inflation measure, increased just 0.1% for the month, putting the annual inflation rate at 2.1%. The monthly reading was in line with the Dow Jones consensus forecast while the annual level was 0.1 percentage point lower.

Excluding food and energy, the core reading that tends to get even greater focus from Fed policymakers showed readings of 0.1% and 2.5%, against respective estimates of 0.1% and 2.6%.

Consumer spending, though, slowed sharply for the month, posting just a 0.2% increase, in line with the consensus but slower than the 0.7% rate in March. A more cautious consumer mood also was reflected in the personal savings rate, which jumped to 4.9%, up from 0.6 percentage point in March to the highest level in nearly a year.

Read more: https://www.cnbc.com/2025/05/30/inflation-rate-slipped-to-2point1percent-in-april-lower-than-expected-feds-preferred-gauge-shows.html

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Article finally updated.

Original article -

Published Fri, May 30 2025 8:33 AM EDT | Updated 1 Min Ago


The personal consumption expenditures price index was expected to show a 2.2% annual rate in April, according to the Dow Jones consensus forecast.

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[everyonematters]

1. Polls show voters still think prices are too high.

[gab13by13]

2. Sorry if I now distrust these numbers,

Krasnov really wants interest rates lowered to weaken the dollar and strengthen Crypto where he is making a killing.

Funny how inflation is higher in the rest of the world.

[Ferrets are Cool]

8. This!!

[rurallib]

14. Exactly my first thought

Will there be any numbers that we can trust from this group of thugs?

[Beachnutt]

3. With the felon in the whitehouse

It is hard to trust any numbers coming out as all the department heads are afraid of him.
Numbers now days are skewed and tilted in his favor on purpose. imo.

[getagrip_already]

4. I've said this before - the numbers are being cooked.....

There is no way inflation is down. Virtually every tem on the lists used to measure it is up, and up steeply. The only thing that hasn't skyrocketed is gas, but that hasn't really gone down.

Sure, housing sales in some markets is crashing, but that isn't enough to offset other costs. And housing costs aren't really falling, rents are not coming down.

[doc03]

5. Strange with all the predictions of tariffs causing higher prices and empty shelves

the inflation keeps going down and the shelves at Walmart are still full. I don't know who we
can believe anymore. Can we even believe the statistics the government puts out.

[gab13by13]

7. It takes time for shelves to go empty,

Retailers stocked up on goods before the tariffs hit. Look at the ports, they are not back to where they were. Empty shelves for certain items will be coming.

[Littlered]

19. What items?

I am always looking to get ahead of the curve on things like this.

[Littlered]

18. I'd trust what I experience.

Outside of that. I would actually listen to what this administration is saying (not an opinionated news source). And form an opinion based upon on how that relates to your experience.

[progree]

6. From the source. Also the concept of a lying asshole inflation index. And house prices.

BEA news release:
https://www.bea.gov/news/2025/personal-income-and-outlays-april-2025

# PCE: April: +0.1%, 12 months: 2.1%, 3 month average annualized: 2.1%
# Core PCE: +0.1%, 12 months: 2.5%, 3 month average annualized: 2.7%

The 3 month number is my calculation from the actual index values.

PCE: https://fred.stlouisfed.org/series/PCEPI
Core PCE: https://fred.stlouisfed.org/series/PCEPILFE

The above takes a while to update, and as of 906 AM ET, they haven't been updated.

For the index values of the last several months, Table 5 in the news release has the numbers, and that's where I got them. Choose Full Release and Tables, NOT Tables only.

This is known as a lying asshole inflation index. It takes substitution fully into account. So for example if high and rising beef prices cause enough people to switch to turkey necks, a lying asshole index (aka chained price index) shows that as a reduction in meat prices. For that reason, I have little regard for this index.

Unfortunately, for anyone trying to understand and predict Fed policy, this, especially the core measure, is their favorite index. Probably because it is almost always lower than the CPI, so it makes it appear the Fed is doing a better job than it really is in getting inflation down.

The latest CPI report, released May 13, is at https://www.democraticunderground.com/10143458249
my CPI graphs are at https://www.democraticunderground.com/10143458249#post15

The CPI (and I'm pretty sure this is true for the PCE as well) does not include home prices because they consider it an investment, not a consumption item (the home seller gains from a high home price while the buyer is screwed). They don't include home insurance or property taxes either. Instead they use "owner's equivalent rent" - a homeowner's estimate of what the property would rent for, under the theory that this is the income foregone by the homeowner for living there as opposed to renting it out, i.e. what the homeowner is "consuming" by living there.

[gab13by13]

9. Excellent post, thank you,

I am curious what you think about my theory about Krasnov.

Krasnov does everything for Krasnov, with that in mind, everything that he is doing is designed to weaken the dollar. His tariffs, his increasing the debt, his pressure on Powell to cut interest rates are designed to weaken the dollar and strengthen Crypto where he is hauling in billions.

[BumRushDaShow]

11. Thanks for the source info!

Usually BEA throws that out there in a Xitter post but their data posts were fragmented this morning. It's also a weird day for the report although it's probably because Monday was a holiday!

[IA8IT]

10. In my corner of Iowa 85% lean ground beef is $6 lb. IN IOWA!! and that's a 10 lb tube price.

[NoMoreRepugs]

12. Perception not reality is paramount in TrumpLand.

[Texin]

13. Yeah. Sure it did.

[Wiz Imp]

15. This is ridiculous. Personally I have never heard of the Personal Consumer Expenditure Price Index called any kind of

Last edited Fri May 30, 2025, 12:26 PM - Edit history (1)

an official measure of inflation. It's always been the CPI.

The CPI is the most widely used measure of inflation and is sometimes viewed as an indicator of the effectiveness of government economic policy.

https://www.bls.gov/cpi/questions-and-answers.htm

The PCE is not limited to prices paid by households (odd given the name) so it is actually a less accurate measure of prices paid by consumers in my opinion.

Most importantly, the difference in the rate as measured by the 2 indices recent years has been significant with Trump, Republicans and the Media ALWAYS (100% of the time) referring to the CPI until now. Now they want to focus on the PCE??? Of course they do and it is blatantly dishonest.

https://economics.td.com/us-cpi-pce

As of the second quarter of 2022, the quarter-over-quarter (q/q) change in CPI (seasonally adjusted at annual rates) was a full 3.4 percentage-points above the same period change in PCE – the highest difference on record

Of course that is when inflation peaked. The core PCE inflation rate peaked in 2022 at just 5.58%. Compared to 9.1% for the CPI.



Note, the PCE index showed a drop in food prices in April. That certainly wasn't my experience so I have a hard time putting much faith in those numbers.

[Bengus81]

16. All the high prices are baked in. We're stuck with them but it won't raise inflation

There is no "cheap energy" like that POS yacks on about and how he would make that happen.

[Rebl2]

17. I am

Curious about the unemployment numbers. I am sure they will lie about those as well.