Federal Reserve Chairman Powell warns against overinterpreting CPI data

According to Golden Finance, Federal Reserve Chairman Powell warned on Wednesday not to overinterpret data showing the largest month on month increase in the Consumer Price Index (CPI) in over a year, while also acknowledging that the reading was significantly higher than expected. Powell said at the hearing of the House Financial Services Committee, 'CPI readings are almost higher than all forecasts, but I just want to remind you of two points.'. Firstly, we will not get excited about one or two good readings, nor will we get excited about one or two bad readings. Secondly, our inflation target focuses on the Personal Consumption Expenditures (PCE) price index, as we believe it is a better indicator for measuring inflation. Therefore, you need to know the conversion from CPI to PCE, and tomorrow we will obtain more relevant data from the Producer Price Index (PPI). We will know how the PCE reading is later tomorrow