PCE Inflation Stayed Subdued in April Amid Trump’s Tariff Limbo

The Federal Reserve’s preferred inflation measure stayed subdued in April as spending slowed. But the outlook for the economy has become even more muddied amid constant changes to President Trump’s policies.

The Personal Consumption Expenditures price index, released on Friday, climbed 2.1 percent in April from a year earlier, slightly lower than the previous reading of 2.3 percent and closer in line with the Fed’s 2 percent target. On a monthly basis, prices increased 0.1 percent after staying flat in March.

The “core” personal consumption expenditures price index, which strips out volatile food and energy costs and is closely watched as a measure for underlying inflation, rose 0.1 percent in April. Compared with the same time last year, it is up 2.5 percent. In March, it rose at an annual pace of 2.6 percent.

When adjusted for inflation, personal spending rose 0.1 percent for the month, a significant drop compared to March’s 0.7 percent increase.

The data from the Commerce Department covered a period in which Mr. Trump unveiled and then quickly rolled back aggressive tariffs against virtually all of the country’s major trading partners after U.S. government bond markets seized up. He has since minted tentative deals with some countries, like the United Kingdom, but also threatened fresh levies on imports from the European Union. He delayed those days later.

In the latest twist, a federal appeals court on Thursday agreed to temporarily preserve many of Mr. Trump’s tariffs after a lower court deemed them illegal earlier this week.