Market News

Markets Anticipate Further Decline in PCE Inflation, Federal Reserve’s Preferred Indicator

Anticipate, Decline, Federal, Indicator, Inflation, Markets, PCE, Preferred, Reserves

“Will PCE inflation continue its downward trend? As markets anticipate further declines, the Federal Reserve’s preferred indicator holds the key to understanding the economic landscape ahead.”



The Core Personal Consumption Expenditures (PCE) Price Index, which is the US Federal Reserve’s preferred inflation gauge, is expected to rise 0.3% month-on-month (MoM) and 3.7% year-on-year (YoY) in September. This comes after the Federal Reserve’s Summary of Economic Projections indicated that there could be one more rate hike in 2023. However, the market may overlook the PCE inflation data following Thursday’s GDP report.

The Core PCE Price Index, excluding food and energy, is forecasted to increase by 0.3% in September, a stronger pace than the 0.1% rise in August. On an annual basis, the Core PCE Price Index is expected to rise 3.7%, slightly slower than the 3.9% increase in August. The headline PCE Price Index is anticipated to grow 0.3% MoM in September, with the annual PCE inflation easing to 3.4% from 3.5% in August.

The real Gross Domestic Product (GDP) of the United States grew at an annualized rate of 4.9% in the third quarter, according to the Bureau of Economic Analysis. The PCE inflation rose to 2.9% on a quarterly basis in Q3, while the Core PCE inflation declined to 2.4% from 3.7% in the second quarter.

Federal Reserve Chairman Jerome Powell, speaking before the Economic Club of New York, stated that the lower inflation readings during the summer were favorable, but the September data was “somewhat less encouraging” regarding the Consumer Price Index (CPI) figures.

The PCE inflation report will be released at 12:30 GMT. However, since the PCE figures were already revealed in the third-quarter GDP report, the market reaction is expected to be muted. Investors are currently pricing in a more than 70% probability that the Fed will keep the interest rate steady in 2023, according to the CME Group FedWatch Tool.

The upcoming September PCE inflation report is unlikely to significantly alter market positioning. Investors will have to wait for CPI inflation and employment data for October and November to confirm whether the Fed’s tightening cycle has come to an end.

In terms of technical analysis, EUR/USD remains bearish in the near term, with the Relative Strength Index (RSI) indicator on the daily chart edging lower toward 40. The pair closed below the 20-day Simple Moving Average (SMA) on Thursday after holding above that level for the previous five trading days. Immediate support levels for EUR/USD are at 1.0500, 1.0450 (2023 low), and 1.0400. If the pair stabilizes above 1.0570, buyers could show interest in a technical recovery, with resistance levels at 1.0650 and 1.0700.

Overall, the PCE inflation report is expected to have a limited impact on the market, and investors will be looking to future data releases to determine the direction of the Fed’s monetary policy.

  • .

    .

    Bitcoin investors brace yourselves, as the BTC price may experience a halving crash leading to a drop of over 20%. This significant decline in value could have a major impact on the cryptocurrency Market. Stay tuned for more updates on this developing situation. The markets are experiencing acute selling pressure as global factors have been…

  • Revolutionary Retouch4me Photoshop Panel Introduces Groundbreaking Cloud-Based AI Editing Feature

    Revolutionary Retouch4me Photoshop Panel Introduces Groundbreaking Cloud-Based AI Editing Feature

    “Discover the latest update to Retouch4me Photoshop Panel, now featuring cloud-based AI editing for a human touch in your photos. Enhance your images effortlessly with this innovative tool!” Retouch4me has introduced a new update for its Adobe Photoshop panel that revolutionizes the way users edit their images. With this new update, users can seamlessly switch…

  • How Long Is a High School Soccer Game? A Guide to Soccer Match Duration

    How Long Is a High School Soccer Game? A Guide to Soccer Match Duration

    A high school soccer game typically lasts 80 minutes, divided into two halves of 40 minutes each. However, with added time for stoppages and halftime, the total time can be around 1.5 to 2 hours. This fast-paced and exciting sport brings together teams of passionate players, vying for victory on the field. Let’s dive into…

Leave a Comment

Snap Analyst Ratings: 12 Experts’ Viewpoints, Price Targets, and Performance Evaluations Dubai Floods and the Postponement of Token2049 Conference What Happens If You File Taxes After April 15? Iran-Israel Conflict Escalates, Threatens to Surge Oil Prices Above $100 Qantas Reroutes Perth-London Flights Amid Middle East Tensions
Snap Analyst Ratings: 12 Experts’ Viewpoints, Price Targets, and Performance Evaluations Dubai Floods and the Postponement of Token2049 Conference What Happens If You File Taxes After April 15? Iran-Israel Conflict Escalates, Threatens to Surge Oil Prices Above $100 Qantas Reroutes Perth-London Flights Amid Middle East Tensions
Snap Analyst Ratings: 12 Experts’ Viewpoints, Price Targets, and Performance Evaluations Dubai Floods and the Postponement of Token2049 Conference What Happens If You File Taxes After April 15? Iran-Israel Conflict Escalates, Threatens to Surge Oil Prices Above $100 Qantas Reroutes Perth-London Flights Amid Middle East Tensions