Price changes may cause consumers to switch from buying one good to another. Whereas the fixed-basket CPI does not account for altered spending habits caused by price changes, the PCE Deflator's ability to account for such substitutions makes it the preferred measure of inflation for the Federal Reserve. Thus, changes in the PCE offer insight on the direction of future monetary policy.

On a Technical Note: In reality, the CPI and PCE Deflator report very close figures. On average the two differ by about 0.3% annually, with the CPI tending to overstate inflation and the PCE understating it.

Relevance: Tends to move markets on release
Release schedule : 12:30 (GMT); monthly, four to five weeks after the reporting month
Revisions schedule : Moderate revisions in the months following the report as more complete data is available, plus annual revision in July or August.
Source of report : Bureau of Economic Analysis, Department of Commerce (U.S.)
Web Address : http://www.bea.gov/
Address of release : http://www.bea.gov/bea/newsrel/pinewsrelease.htm
AKA : PCE Price Index, Chain Deflator, Implicit Price Deflator for Personal Consumption Expenditures , IPD for PCE, Chain-Type Price Index for Personal Consumption Expenditures , CTPIPCE