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Core PCE due Wednesday could shape the Fed’s year-end rate outlook

Investors are looking for core PCE to rise 0.3% month over month in August, up from 0.2% in July.

Reported · Written up by our desk · Central Banks

The US Bureau of Economic Analysis will release August Personal Consumption Expenditures Price Index data on Wednesday at 12:30 GMT, a key inflation read closely watched for clues on the Federal Reserve’s policy path.

According to FXStreet, market expectations call for the core PCE Price Index, which excludes volatile food and energy, to increase 0.3% month over month in August, after a 0.2% rise in July, with the annualized figure seen at 3.4% versus 3.3% the prior month.

FXStreet also notes that PCE inflation is the Fed’s preferred measure of inflation and that the report could influence market bets for the Fed’s final two meetings of the year, following the central bank’s September decision to raise rates by 25 basis points to a 3.75% to 4.00% target range.

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