Core PCE Inflationthe Federal Reserve’s preferred indicator of inflation, rose 4.6% year-on-year in February 2023, the lowest rate in 15 months and below market expectations an increase of 4.7%.

Core PCE prices rose 0.3%m/m after rising 0.5% in January, beating market expectations of 0.4%.

Here are economists’ and pundits’ reactions to the data and their take on upcoming Federal Reserve action.

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“No More Hikes Please”: Robin BrooksChief Economist of Institute for International Finance (IIF)warned on his Twitter that a credit crunch of unknown severity is brewing and the risk of a recession is rising dramatically, and urged the Federal Reserve to stop raising interest rates.

Michael GapChief Economist of the USA Bank of America, said in a note on Friday that the data supports the House view that the Fed will hike 25 basis points in May before going on hold. BofA noted that the 0.2%m/m decline in core non-home services after a 0.5%m/m increase in the previous month is an “encouraging print of the day” for the Fed.

Jeffrey RoachChief Economist for LPL Finance: “Prices rose 0.3% mom in February, pushing annual inflation to its lowest level since September 2021 and eventually giving the Fed some leeway. The inflation trend looks promising for investors. Inflation is likely to be below 4% by the end of the year, giving the Federal Reserve some leeway to cut rates by the end of the year if the economy slips into recession,” he said in a statement.

Eric Rosengrenformer President and CEO of Boston Federal Reserve: “While PCE inflation was viewed positively by markets in today’s release, I’m not sure how reassuring it should be. Core PCE is coming down fairly slowly and is currently not on a path to the low 3’s by the end of this year. ‘ he wrote on Twitter.

Nick Timaroes, …