Dangerous signs in the US PCE deflator on the 29th.

The Personal Consumption Expenditures (PCE) Core Price Index, which the Federal Reserve emphasizes as an inflation indicator, is expected to have a significant increase in January, possibly highlighting the challenges in curbing price hikes.

The PCE core index excluding food and energy is expected to rise by 0.4% compared to the previous month. The rate of increase has decreased in most of the past two years, but it is expected to have consecutive increases for two months in January following December last year.

When converting this data on a 3-month or 6-month basis, it will return to over 2% in both cases. In December of last year, it was below the 2% target set by the authorities.

So, excluding the recent rise in crude oil prices, the PCE core has been rising for 2 consecutive months, while the US 10-year bond yield has been fluctuating around 4.2% to 4.3%, deviating from market expectations.

And according to current estimates, the PCE core month-on-month increased by 0.5%, which is 0.3 points higher than the previous month.
The expected year-on-year increase is 2.8%, but if it comes out at 2.9% to 3.0%, we may see a slight further rise in interest rates, reaching levels where the current stock prices cannot be justified by yield spreads.

The Nikkei average and TOPIX continue to show strength and do not seem likely to collapse, which is also a characteristic of being in the upper range.
If one is wary of the PCE, it would not be surprising to see a pullback as early as tomorrow.

At the start of the week, how New York will move may be more important than the Japanese market today and tomorrow.