US Core PCE Index Inflation (June 2024)

- Core PCE Increase: Up 0.2% in June and 2.6% year-on-year.

- Consumer Spending: Rose 0.2%, showing steady growth.

- Treasury Rally: Treasuries rallied, and stock futures remained positive.

- Three-Month Inflation: Cooled to 2.3%, the lowest since December.

- The Fed is expected to keep interest rates unchanged next week, with a potential rate cut in September.

- Consumer Sentiment: Fell to an eight-month low in July.

So, what does this mean for us investors? Firstly, the fact that inflation is cooling down is a positive sign. It means the Fed's strategy is working without causing major disruptions.

However, consumer sentiment is low, and income growth is slowing, which could impact spending power in the near future.

While the Fed might hold off on hiking rates next week, a rate cut in September seems possible. This could provide some relief to markets and borrowers alike. However, keep an eye on consumer sentiment and spending power—these will be crucial indicators of economic health moving forward.

What do you think? Are we on the right track to beating inflation, or should we be prepared for volatility? Drop your thoughts below! 💬