Inflation woes were allayed a bit this morning when a key gauge was better than feared. The June Core PCE grew 0.4%, slower than the 0.5% rise in May and below the gain of 0.6% expected. The annual Core PCE increased 3.5% from 3.4%. The Core PCE measures prices paid by consumers for goods and services, excluding food and energy. The index is the fed's favorite inflation gauge.
Consumer spending rose in June with Americans shelling out for services at the start of the summer. Personal Spending rose 1% from May and above the 0.7% increase expected. Incomes were up scantily by 0.1% with a decline of 0.6% estimated. Since the country fully reopened, the restaurant and travel sectors have benefitted. Consumer spending makes up two-thirds of U.S. economic activity and is vital for economic growth.
Stocks are lower today as the month comes to an end but the Dow, S&P and NASDAQ are on pace for their sixth straight monthly gains. Stocks are falling after Amazon posted glum earnings after hours on Thursday but earnings have been solid so far this season. Of the 195 companies in the S&P 500 that have reported Q2 earnings, almost 91% have exceeded estimates, according to Refinitiv.