Cooling Inflation Eases Market Fears

U.S. stock index futures recovered some losses after a cooler-than-expected inflation report. The Commerce Department's PCE index rose 2.4% annually, lower than the estimated 2.5%. The core PCE index also increased by 2.8%, slightly below the 2.9% forecast. Stock indexes saw varying declines by early morning.

On Friday, U.S. stock index futures managed to regain some of their earlier losses following a cooler-than-anticipated inflation reading. The data eased investor concerns regarding the probability of fewer rate cuts next year.

According to a Commerce Department report, the Personal Consumption Expenditure (PCE) index, which is the Federal Reserve's favored measure of inflation, recorded a 2.4% increase in November on an annual basis. This was slightly below the economists' forecasted rise of 2.5%, as gathered by Reuters. On a month-to-month basis, the index showed a modest rise of 0.1%.

When volatile food and energy components are excluded, the core PCE index rose by 2.8%, compared to an expected increase of 2.9%. On a monthly scale, it also marked a 0.1% rise. By 8:32 a.m. Eastern Time, the Dow E-minis were down 116 points, or 0.27%. Similarly, S&P 500 E-minis and Nasdaq 100 E-minis exhibited declines of 31 points, or 0.52%, and 192.5 points, or 0.9%, respectively.

(With inputs from agencies.)