US Consumer Spending and Core Inflation Firm in January

US consumer spending rose 0.4% in January while core PCE inflation climbed to 3.1% annually. The firm data suggests the Fed will hold interest rates steady.

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Consumer spending in the United_States rose more than anticipated in January, as persistent inflation and geopolitical tensions in the Middle East led economists to conclude that the Federal Reserve will likely delay interest rate cuts. According to data released by the Commerce Department’s Bureau of Economic Analysis, consumer spending—which represents more than two-thirds of domestic economic activity—increased by 0.4% following a matching gain in December. This result surpassed the 0.3% growth forecast by analysts.

Pedestrians walk along Fifth Avenue in New York City, reflecting the resilient consumer activity in the American economy. REUTERS/Adam Gray
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