Personal Consumption Expenditures (PCE)
What is PCE? Personal Consumption Expenditures is the Federal Reserve's preferred inflation gauge, tracking consumer spending and accounting for substitution effects.
Personal Consumption Expenditures (PCE) is the Federal Reserve's preferred measure of inflation. It tracks consumer spending and accounts for substitution effects.
Unlike CPI, PCE uses a broader base of goods and services and adjusts when consumers switch to cheaper alternatives. The Fed targets 2% Core PCE inflation.