All Eyes On PCE: What to Expect From Fed's Key Inflation Metric This Friday
Portfolio Pulse from Piero Cingari
The Bureau of Economic Analysis is set to release the Federal Reserve’s preferred measure of inflation, the personal consumption expenditure (PCE) index for August. The headline PCE price index is expected to rise from July’s 3.3% year-on-year increase to a 3.5% year-on-year jump in August. The core PCE price index is forecasted to ease from 4.2% year-on-year to a 3.9% year-on-year increase in August. The U.S. dollar, as tracked by the Invesco DB USD Index Bullish Fund ETF (NYSE:UUP), is at a 10-month high, and the SPDR S&P 500 ETF Trust (NYSE:SPY) is down nearly 5% this month.

September 28, 2023 | 7:55 pm
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POSITIVE IMPACT
The U.S. dollar, as tracked by the Invesco DB USD Index Bullish Fund ETF (NYSE:UUP), is at a 10-month high.
The expected increase in the PCE index could strengthen the U.S. dollar, which would be positive for UUP.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
The SPDR S&P 500 ETF Trust (NYSE:SPY) is down nearly 5% this month.
The expected increase in the PCE index could lead to further uncertainty in the market, which could negatively impact SPY.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80