The next Core Personal Consumption Expenditures (QoQ) data will be released on Thursday, at 12:30 GMT, by the Bureau of Economic Analysis, Department of Commerce. The latest release which published data for July took place on August 29 and was in line with forecasts, remaining unchanged at an all-time high. Under inflationary pressures, the Federal Reserve is expected to raise interest rates for the third time this year on September 26.
The Personal Consumption Expenditure Price Index at an all-time high
The United States Core Personal Consumption Expenditure (PCE) Price Index went up 2.0 percent in July, reaching an all-time high of 110.12 Index Points, above one percent in June and in line with market expectations. The released data suggested a strong economic growth early in the third quarter and chief economist Chris Rupkey affirmed that “consumers are doing their part to keep the economy’s engines running strong in the second half of the year”.
The Department of Commerce noticed that households spent more at restaurants and on accommodation in July, as well as on prescription medication.
Such strong domestic demand combined with the raising prices of imported goods could grow inflationary pressures. As a consequence, the Federal Reserve is expected to increase interest rates for a third time this year in September, with 25 points.
The PCE stance in the Forex market
The Core Personal Consumption Expenditure Price Index excludes prices of food and energy, but it is considered an important indicator of the United States inflation rate. The concerns over the Trump administration’s protectionist trade policy, which led to trade tensions with China and other trading partners, including the European Union, Canada and Mexico, could hurt the economy and the US dollar value.
However, the next release of the Core Personal Consumption Expenditures (QoQ) by the Department of Commerce, as well as the Fed’s Interest Rate decision could make the market react and bring trading opportunities.