The core PCE price index, which excludes volatile items such as food and energy, remained unchanged at 0.3% level in August above market expectations of 0.2%. Year-on-year, core PCE prices edged up 3.6% in August, the same as in July, in line with market consensus of 3.6%. Although the monthly rate came higher than expected, it is the 3rd consecutive month that core PCE inflation shows signs of cooling.
Personal income rose 0.2 % MoM in August, from 1.1% advance in July and compared to market expectations of a 0.3% increase, supported by increases in compensation of employees and government social benefits.
Personal spending increased 0.8% in August, following 0.1% drop in July and beating market consensus of a 0.6% increase. Spending for food and beverages as well as “other” nondurable goods (mainly, household supplies as well as recreational items) were partly offset by a decrease in spending for motor vehicles and parts. Within services, the increases were widespread, led by “other” services (mainly, personal care and clothing services), housing and utilities, and health care.
EURUSD saw a relatively small reaction to today’s data releases. The most popular currency pair continued to trade around 1.1600 level. Source: xStation5
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