📊 Key Data (August Report)
- Annual (YoY): 2.9% ✅ (Expectation: 2.9% | Previous: 2.9%)
- Monthly (MoM): 0.2% ✅ (Expectation: 0.2% | Previous: 0.3%)
🔎 What It Means
The Core Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s preferred measure of inflation, remained unchanged at 2.9% YoY. The monthly reading slowed slightly to 0.2%, down from July’s 0.3%.
👉 This signals that while inflation pressures are easing at the margins, they remain sticky enough to keep the Fed cautious.
📈 Market Impact
- Bonds & Dollar: Treasury yields steadied as traders priced in fewer near-term Fed cuts. The dollar index showed mild strength.
- Equities: US stock futures reacted with caution, reflecting uncertainty over the timing of rate cuts.
- Crypto Markets: Bitcoin and other risk assets saw sideways movement, as sticky inflation could delay liquidity inflows from a more dovish Fed.
🗣 Expert View
Analysts note that the Fed will likely keep a data-dependent stance, avoiding premature rate cuts. Inflation stuck at 2.9% shows progress, but still above the 2% target. Markets expect the Fed to move cautiously in the coming months.
