35. What Is CPI, PPI & PCE Price Index (Indices) in Fed Speak - Decoded
Market MakeHer Podcast
Why earnings commentary matters to Fed views
Hosts link company commentary on demand and pricing to broader Fed inflation and policy considerations.
Come with us as we leap through the gallows and levitate down WallStreet. 🔮 Today we're discussing the most recent FOMC Press Conference led by the Hawkish Fed Chairman, Jerome Powell, and what it all means when he talks about the CPI & PCE Price Index. There's also a quick SMU (stock market update).
New Vocabulary Word: Tapering
Tapering is a monetary policy used by the Federal Reserve to phase out or reduce the number of assets purchased each month. Listen for more info.
Inflation Is Still Too High, When Are Interest Rates Getting Cut?
Remember in Episode 30 when we talked about how The Fed is projecting to cut rates 3 times this year (and how that's good for getting loans and lower CC interest rates, but bad for our HYSA)? Well now the Federal Reserve is not confident enough in the data to cut those interest rates just yet. They're being left at 5.25-5.5% (for the banks, but then we will still be seeing higher loan rates).
The Fed's Dual Mandate
Papa Powell stated that maximum employment and stable inflation at 2% is still the objective.
So what is inflation at right now?
CPI 3.5% YoY (reported in April, for March) Core is at 3.8% https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm
PPI 2.8% YoY (reported in April, for March) Core is at 2.1%
https://www.bls.gov/charts/producer-price-index/final-demand-12-month-percent-change.htm
PCE 2.7% YoY (reported in April, for March) Next release May 31st Core is at 2.8% YoY https://www.bea.gov/news/2024/personal-income-and-outlays-march-2024
Low Unemployment Rates & Labor Demands
The Fed also said unempl
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Market MakeHer is an investing education podcast taught by a 15-year finance expert to her friend, a beginner investor. Our mission is to demystify the stock market and make financial literacy accessible to all self-directed investors! We teach complex investing topics in a different way - from "Her" perspective.
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