Summary: The latest U.S. data is mixed, with inflation continuing to fall, but personal income and consumer spending also deteriorating. The U.S. dollar index fell in the short-term, and the market may have more reactions when Federal Reserve Chairman Jerome Powell speaks at the annual meeting of the central bank in Jackson Hole.
The latest U.S. PCE inflation report for July showed that headline inflation in July was 6.3%, down 0.5% from June, and core inflation was 4.6%, down 0.2% from June.
PCE is short for Personal Consumption Expenditure. PCE accounts for about 60%-70% of U.S. GDP. A price index based on PCE is the Fed’s preferred inflation indicator. As the last Fed rate decision said, the pace of rate hikes will depend on economic data.
At the same time, economic data released at the same time showed that personal income in the United States increased by only 0.2% in July compared with June (up 0.7% in June compared with May), while personal consumption expenditure increased by only 0.1% (increased by 1% in June compared with May) .
To sum up, the US economy seems to be evolving along the path envisioned by the Fed, that is, sacrificing some demand to curb inflation. Fed official Bostic said inflation data showed the economy was responding to the Fed’s policy and did not see a recession, leaning toward a 50 basis point rate hike in September.
After the data was released, the US dollar index fell 20 points in the short-term.
US Dollar Index 30 minute chart
Markets reacted more restrainedly, perhaps awaiting Fed Chair Jerome Powell’s comments on the economic outlook and policy at the annual Jackson Hole meeting.
The content on this page is for general market commentary only and may not constitute investment advice of any kind (tax, legal, accounting). This article does not constitute an invitation or recommendation for direct investment in specific financial products. The content is for reference only. Readers should not rely on the information in this document, nor should its actions and omissions be relied upon. We are not responsible for the results of any person’s actions or omissions based on this article. We make no warranties as to the accuracy of the content provided or the adequacy of the information. This article is not intended for distribution within the territory of the People’s Republic of China (excluding Hong Kong, Macau and Taiwan for this purpose), except as permitted by the applicable laws of the People’s Republic of China.
Copyright Notice: Except for the purpose of viewing the information on this website, or as permitted by applicable law or these Terms and Conditions, no one may copy, use, upload, link, or publicly perform in any way to third parties without our specific written permission , publish or transmit any information or content on this website. We reserve the right to further investigate the legal responsibilities of the relevant actors for the infringing acts of unauthorized reprinting. If you have business cooperation needs such as market promotion and resource exchange, please contact us.
element inside the element. This is probably not what you meant to do! Load your application’s JavaScript bundle inside the element instead.
