The Bureau of Economic Analysis' Personal Consumption Expenditures (PCE) index rose 6.1% in January year-over-year, according to the firm's latest report published Friday, representing the fastest rise since 1982. On a month-over-month basis, PCE rose 0.6%. In December, PCE rose by 5.8% on an annual basis.
Stocks climbed Friday, added to Thursday's rally, as investors continued to weigh the financial risks surrounding Russia's invasion of Ukraine alongside a slew of fresh economic reports. The Dow Jones Industrial Average rose over 800 points, posting its best day of the year, while the S&P 500 Index and Nasdaq Composite climbed about 2.2% and 2.5% higher, respectively.
Despite the gains, the Dow posted its third-straight week of losses. However, the S&P 500 and Nasdaq finished the week in the green, climbing 0.8% and 1.1% higher, respectively.
Here's how the market settled to close out the week:
S&P 500 Index
Dow Jones Industrial Average
Nasdaq Composite Index
Pending home sales fell to lowest level in nearly a year:
Pending home sales posted the largest decline in almost a year in January, as rising interest rates and tight inventory levels begin to impact housing market activity.
The rate of homes under contract to be sold fell by 5.7% in January over December and fell by 9.5% compared to the same month in 2021, according to the National Association of Realtors report published Friday. The drop was the largest decline since Febraury 2021 and represented a third straight monthly decrease.
Consumer sentiment falls to lowest level in a decade:
Consumer sentiment ticked higher in late February but still marked the lowest level in a decade as consumers grew more worried about rising inflationary pressures.
The University of Michigan's headline index rose to 62.8 in the final monthly print for February, according to the institution's latest report published Friday, rising from the 61.7 previously reported. Still, this was the worst reading in about a decade, falling from January's print of 67.2.
"The February descent resulted from inflationary declines in personal finances, a near universal awareness of rising interest rates, falling confidence in the government economic policies, and the most negative long term prospects for the economy in the past decade," said Richard Curtain, chief economists at Surveys of Consumers, in a press statement.
"The financial harm and growing angst among consumers about rising inflation have pushed nearly nine-in-ten consumers to anticipate interest rate hikes," he added. "The Fed's clinging to the transient hypothesis meant missed opportunities to nip inflation at its earliest stages; aggressive actions are now needed to avoid the pontential establishment of an inflationary psychology that acts to form a self-fulfilling prophecy."
Personal spending rose despite inflationary pressures:
U.S. consumer spending rose at a faster-than-expected rate in January despite persistent inflationary pressures.
The Bureau of Economic Analysis' Personal Spending rate rose by 2.1% in January, according to the firm's latest report published Friday, helping reverse a 0.8% monthly decline in December.
Personal consumption expenditures rose at fastest rate in four decades:
