Breaking News: PCE Price Index Matches Forecasts, Federal Reserve Likely to Cut Interest Rates in September!
The Commerce Department reported that the Personal Consumption Expenditures (PCE) price index rose 0.2% last month, in line with economists' expectations. This data is unlikely to sway the Federal Reserve from lowering interest rates by at least 25 basis points in September. In the 12 months through July, the PCE price index increased 2.5%, beating expectations.
Market Reaction:
- Stocks: U.S. stock futures were up 0.35%
- Bonds: U.S. Treasury yields ticked up
- Forex: The dollar firmed while the euro weakened
Experts' Comments:
- Olu Sonola, Fitch Ratings: Consumer spending remains strong, indicating solid economic growth
- Brian Jacobsen, Annex Wealth Management: Fed may see initial slowdown in growth post rate cut
- Sam Stovall, CFRA Research: Report confirms focus on employment trends by Fed
- Cameron Dawson, NewEdge Wealth: Market is in a soft landing with resilient growth
- Peter Cardillo, Spartan Capital Securities: Inflation has peaked, recession prospects are low
Analysis:
The latest data on the PCE price index suggests that the Federal Reserve is likely to proceed with an interest rate cut in September. This could impact various market sectors, including stocks, bonds, and forex trading. The report indicates that inflation is under control, consumer spending is strong, and economic growth remains steady. Investors may see opportunities in the market as the Fed takes steps to support the economy. Overall, this news provides valuable insights into the current state of the economy and potential investment strategies.