Market expectations for the Federal Reserve's next interest rate move could gain more clarity as early as this Friday, when a U.S. government agency releases a key inflation metric closely monitored by policymakers.
The Personal Consumption Expenditure (PCE) price index report, scheduled for release on Friday, Sept. 27, at 8:30 a.m. ET, will provide critical insights into August’s inflation trends.
As the Fed’s preferred inflation gauge, the PCE is seen as a crucial indicator that could influence decisions on whether another rate cut will occur at the next Federal Open Market Committee (FOMC) meeting on Nov. 7.
Currently, market-implied probabilities suggest a 60% chance that the Fed will enact a back-to-back 50-basis-point rate cut in November. The remaining odds are favoring a more modest reduction of 25 basis points, as per the CME FedWatch tool. However, this outlook could shift dramatically depending on how the upcoming PCE data performs.
Fed’s Confidence In ...
