So the core PCE deflator did indeed come in at 0.4% MoM/2.8% YoY as the market had anticipated following those elevated core CPI and PPI prints – but given the recent performance of US data the fear was we could get yet another upside surprise. This is the Fed's favoured inflation metric to follow (it is broader in coverage than CPI and in the Fed's view better represents the spending patterns of the US consumer). The super-core measure, which strips out housing from core services came in at 0.6% MoM. There was a downward revision to December, now reporting a 0.1% MoM increase versus 0.2% initially reported. While ... (full story)