Consumer expenditure, which is responsible for more than two-thirds economic activity0.1% fell last month after 0.2% profit in April, Commercial departmentThe Bureau of Economic Analysis Bureau said on Friday. Economists voted by Reuters had estimated consumer expenses that it would increase by 0.1%.
President Donald Trump’s sweeping tariff, which has led to business and purchase of front-run imports and goods to homes, to avoid higher prices from duties, reduced the economic picture. Economists warned that it could take time to wash out of data for deformities related to tariffs.
a record Goods trade deficit In the first quarter, thanks to a holocaust of imports, the decline in GDP during that period was responsible for the 0.5% annual annual rate of decline.
Consumer expenses were also dropped in the last quarter in the last quarter, causing houses to be purchased to carry forward the purchase of houses. Families spent less on services in the previous quarter, helping to increase consumer spending only 0.5% speed, the fastest rate since the second quarter of 2020.
This data potentially spends on a slow growth path in the second trimester. A combination of soft consumer expenses and inflation, however, is unlikely to motivate the Federal Reserve to cut interest rates in July. Fed Chair Jerome Powell told MPs this week that the US Central Bank needs more time to reduce the impact of tariffs on prices before considering the rate cut. Economists argue that the price growth remains moderate because businesses are still selling accumulated inventory before the tariff is effective. He hopes that inflation will begin with consumer price data for June.
The BEA stated that individual consumption expenditure (PCE) Price Index increased by 0.1% in May, matching the increase in April, BEA said. In 12 months through May, PCE inflation increased by 2.3% after climbing 2.2% in April.
Separating volatile food and energy components, PCE Price Index Last month increased by 0.2%. The so -called core PCE inflation increased by 0.1% in April.
In 12 months through April, core inflation increased by 2.7% after 2.6% increased in April. Fed tracks PCE price measures for its 2% inflation target. The Central Bank left its benchmark overnight interest rate in the range of 4.25% -4.50% last week, where it is from December.
