Fed’s preferred gauge showed core inflation at 3.0% in August, much lighter than expected
Core PCE rose 0.2% from July, and the annual rate held at 3.0%, giving policymakers a softer reading than economists expected.
- On Wednesday, the Commerce Department's Bureau of Economic Analysis reported that August PCE inflation rose 3.4% year-on-year, while core inflation held at 3.0%, both below economist expectations.
- The Bureau of Economic Analysis introduced revised methodology for calculating price indexes, retroactively adjusting data back to 2021 to better reflect software, legal services, and portfolio management costs, which lowered recent inflation readings.
- Consumer spending surged 0.9% in August, signaling economic resilience, while markets rallied as investors reduced bets on an October Federal Reserve rate hike following the softer inflation reading.
- New York Federal Reserve President John Williams stated "there is no need for urgency," prompting traders to pare the probability of an October rate increase to roughly 35% from prior expectations.
- Despite the softer inflation reading, price pressures remain above the Federal Reserve's 2% target, and officials have signaled that further rate adjustments may be necessary to achieve long-term price stability.
203 Articles
203 Articles
The Dow Jones lost 0.86% and the expanded S&P 500 index fell by 0.25%. Only the Nasdaq index finished in the green (+0.24%). According to the PCE index published on Wednesday, prices rose by 3.4% over a year in the United States in August. The market was down by 3.7%. At the same time, US economic growth in the second quarter was significantly revalued upwards (+2.2% annualized, compared to +1.5% previously reported). "These reports have strengt…
Mixed trends prevailed on the New York Stock Exchange. In the wake of the publication of new data on the course of inflation in the US, which strengthened investor forecasts that the US central bank (Fed) will not raise interest rates in October. The Dow Jones industrial average closed down 443.87 points (-0.86%), at 50,906.05 points. The Nasdaq index, dominated by technology companies, closed up 65.52 points (+0.24%), at 26,861.06 points. The b…
US investors are eagerly looking at the consumer price index, which indicates a cooling inflation. Interest-rate fears are decreasing, especially tech-values are accounting for profits. However, rising bond yields provide a damper to the end of the day.
The Billings Gazette
S&P 500 dips, Nasdaq higher after data shows moderate inflation rise
NEW YORK — The Nasdaq climbed Wednesday and the S&P 500 dipped, but both indexes notched their second straight quarterly gains as a softer-than-anticipated inflation reading cooled expectations that Federal Reserve policymakers would hike rates in October.
S&P 500 falls 0.25%, Dow loses 444 points, while Nasdaq gains 0.24%; European stocks finish lower
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