Although Federal Funds Futures still show an 87% probability of a Fed rate cut on September 17th, this latest inflation data remains far above the Federal Reserve’s 2% inflation target…
The Personal Consumption Expenditures (PCE) Price Index for July remained unchanged at a rate of 2.6% year-over-year. However, the Core PCE reading increased from 2.8% to 2.9% year-over-year. Core PCE is the Fed’s preferred inflation measure as it removes the volatile food and energy components, giving a better view of the longer-term trend of inflation. Together with the increase in the Core Consumer Price Index (CPI) from 2.9% to 3.1% year-over-year, this reveals the Fed’s inflation battle could be far from over.
