Xcel Energy Inc. (XEL) Stock Forecasts

Summary

The Fed’s favorite inflation indicator, the PCE Price Index, is being released this morning by the BEA. The index differs from the better-known Consumer Price Index (CPI) because its composition changes frequently and it reflects real-time prices more quickly. Through June, PCE inflation was reported at 2.5% annualized; by comparison, the last CPI report, through July, had inflation at 2.9%. Core PCE, which strips out volatile food and energy prices, was 2.6% last month. Our PCE forecasts call for 2.6% for both the headline and core readings—essentially flat month to month, as progress toward the Fed’s 2% target becomes more difficult as we get closer to the target. Inflation this cycle peaked in the summer of 2022 and has been declining fairly consistently. We track 20 monthly inflation numbers. On average, they indicate that prices are rising by 2.8% year-on-year, down 12 basis points from a month ago. The figures are volatile and somewhat distorted by extremely low values ​​within the Producer Price Intermediate Goods category, perhaps indicating falling prices across the inflation spectrum in the coming months. If we focus on core inflation, which we obtain by averaging core CPI, market-based PCE Ex-Food & Energy (from t