Fed's Preferred Inflation Gauge Falls Short Of Expectations In July, Personal Spending Accelerates
Portfolio Pulse from Piero Cingari
The Federal Reserve's preferred inflation measure, the PCE Price Index, remained steady in July but fell slightly short of expectations. Personal spending and income showed strong growth, suggesting robust consumer health. This data impacts expectations for future Fed rate cuts, with market probabilities for a 50-basis-point cut in September slightly decreasing. The U.S. dollar index rose, and futures on major U.S. equity indices increased.
August 30, 2024 | 12:48 pm
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POSITIVE IMPACT
The SPDR Dow Jones Industrial Average ETF (DIA) hit record highs, reflecting positive market sentiment despite mixed inflation data.
The DIA ETF reached record highs, indicating positive investor sentiment. This is likely due to strong consumer spending data, which supports economic growth despite mixed inflation figures.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
The Invesco DB USD Index Bullish Fund ETF (UUP) rose 0.2% following the release of the PCE data, reflecting a stronger U.S. dollar as inflation came in below expectations.
The UUP ETF, which tracks the U.S. dollar, increased due to the PCE inflation data coming in below expectations, suggesting a stronger dollar. This aligns with market reactions to inflation data.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80