Mar 2025 PCE Estimate

On Wednesday at 10 am ET, we will get the Mar PCE inflation. Since I started publishing my PCE estimates in Mar 2024 (13 monthly forecasts so far), my average error for forecasting headline PCE was perfect at 0 bps. That said, the Feb headline PCE came in +1 bps above my estimates of +0.32% MoM.

My average error for forecasting core PCE is -1 bps. The Feb core PCE came in +2 bps above my +0.35% MoM estimate.

After much cooler-than-expected CPI and PPI, will PCE follow suit?

My Mar PCE inflation estimates are…

• Headline PCE

  • -0% MoM and +2.2% YoY

• Core PCE

  • +0.1% MoM and +2.5% YoY

If we get these numbers, they may still not make the Fed cut rates in May because, in their view, these numbers don’t include the tariff effect, which is expected to be inflationary. That said, what they end up doing in May will depend on the Apr Employment Report (goes out Fri next week).

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