PCE: Why consumer spending was a 'key driving point' in Jan
January Personal Consumption Expenditure (PCE) data aligned with expectations, with core PCE rising 0.3% month over month and 2.6% year over year. Mizuho Americas US chief economist Steven Ricchiuto joins Morning Brief to analyze these inflation figures and what they signal about the broader economy. Ricchiuto identifies consumer spending as the "key driving point" behind these numbers, noting it grew over 4% in the fourth quarter of 2024. "The underlying trend rate from services continues to be very, very solid, and that will dominate," he explains to Yahoo Finance. He points to a historical pattern where strong fourth quarters are typically followed by weaker first quarters, but notes that "when you average the two, you're still running above trend, and it looks like that pattern is going to continue here." While consumer spending did slow in January, Ricchiuto dismisses concerns about consumer "penny pinching," emphasizing that "services drive the economy." To watch more expert insights and analysis on the latest market action, check out more Morning Brief here. This post was written by Angel Smith
