#USCorePCEMay In May 2025, the U.S. core Personal Consumption Expenditures (PCE) index—a key inflation gauge excluding food and energy—rose 0.2% month-over-month and 2.7% year-over-year, slightly surpassing expectations. Headline PCE inflation increased 0.1% monthly and 2.3% annually, aligning with forecasts. Despite these modest upticks, the Federal Reserve maintained its interest rate at 4.25%-4.50%, signaling caution amid persistent inflation pressures. Concurrently, personal income and spending declined by 0.4% and 0.1%, respectively, reflecting potential economic softening. These developments suggest a complex economic landscape, with the Fed balancing inflation control against growth concerns.