US June PCE Falls 0.1% MoM, First Decline in Four Years

US PCE drops 0.1% MoM, first decline in four years, while core rises 0.1%. Fed holds rates steady as market expectations for future policy diverge sharply.

Woofun AI data shows that the US Personal Consumption Expenditures Price Index declined by 0.1% month-over-month in June, marking the first monthly drop in four years, with year-over-year growth at 3.7%. Core PCE increased by 0.1% month-over-month, reaching a year-over-year rate of 3.3%, personal consumption expenditures rose by 0.3%, personal income grew by 0.2%, and the savings rate fell to a four-year low of 2.7%.

The Federal Reserve maintained interest rates unchanged during its July meeting. Market forecasts for future policy vary significantly: JPMorgan Chase anticipates a 25 basis point hike in December, Goldman Sachs and Barclays expect stability for the remainder of the year, Bank of America projects three hikes starting in September, and Citigroup maintains expectations for cuts in October, December, and January 2027. CME FedWatch data indicates a 65.2% probability of a September rate hike.