Federal Reserve officials are on the hunt for data that gives them greater confidence that inflation is progressing toward their 2% annual target—before they cut interest rates. The May reading of the Fed’s preferred measure of price growth should signal a step in the right direction.

The personal-consumption expenditures, or PCE, price index for May will be published at 8:30 a.m. Eastern on Friday as part of the Bureau of Economic Analysis’ personal income and outlays report.

The consensus forecast among economists surveyed by FactSet is for an unchanged PCE price index, following monthly gains of 0.3% in February, March, and April. The year-over-year increase is projected to have slowed to 2.6% in May, from 2.7% previously.

The core PCE index, which excludes food and energy components, is expected to have gained 0.1% in the month of May and 2.6% from a year earlier. In April, the core index rose 0.2% month over month and 2.8% year over year.

The PCE price index peaked above 7% yearly growth in 2022, then declined to below 3% by the end of 2023. But it has moved more or less sideways this year. If projections for May are true, the index would be back in a downtrend.

“PCE inflation for May released on Friday should solidify further slowing in the Fed’s preferred inflation measure after Q1 strength,” wrote Citi economists this week.

The consumer price index, an alternative measure of inflation, followed a similar pattern in early 2024 before resuming its downward drift in May. Data released by the Bureau of Labor Statistics on June 14 showed a flat CPI in May and a slower than expected 3.3% year-over-year rise. The core CPI was up 0.2% on a monthly basis and 3.4% from a year ago.