April 24th, 2026 | Should the Fed still use the PCE as its inflation guide? The consumer remains strong, New Apple CEO stock gains coming? Is Your Annuity Safe? & More
From Smart Investing with Brent & Chase Wilsey by Brent and Chase Wilsey
April 24, 2026 · 56 min
About this episode
The episode discusses the relevance of the PCE as an inflation guide, consumer spending trends, and the impact of healthcare on the economy.
Should the Fed still use the PCE as its inflation guide? I’ve talked a lot about the shelter index being misleading when it comes to inflation, especially when looking at the CPI, but the PCE has its flaws as well. The Federal Reserve has a 2% inflation target and uses monetary policy, which includes adjusting the Fed Funds rate, to tackle its dual mandate of maximum employment and stable prices. A big problem I see with the PCE is that healthcare now accounts for roughly 16% to 17% of index. This comes as an aging population led healthcare spending to be the single largest contributor to consumer spending in 2025. It surpassed housing and utilities in early 2023 as the fastest growing category in the PCE and by Q3 of 2025, it contributed nearly a full percentage point to overall economic expansion and accounted for nearly half of all spending growth. While it’s… Even with all the noise, the consumer remains strong March retail sales showed a nice increase of 4.0% compared to last year and while gas stations were a large contributor growing 18.1% due to higher gas prices, excluding them from the report still would have resulted in a good increase of 2.9%. The only areas that saw…
People in this episode
Hosts: Brent Wilsey, Chase Wilsey
Topics covered
- inflation
- PCE vs CPI
- consumer spending
- retail sales
- healthcare spending
- economic expansion
Keywords
- inflation guide
- PCE
- CPI
- consumer spending
- retail sales
- healthcare
- economic growth
- Federal Reserve
Mentioned in this episode
Organizations: Federal Reserve
Products: PCE, CPI
Places: United States
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