AFMC - The Markets Are Bracing For The April PCE Report

2024-05-30 13:51:04 ET

Summary

• Analysts expect the April headline PCE to rise by 0.3% m/m and 2.7% y/y, potentially pushing the Fed further from its 2% inflation target.
• Core PCE is also expected to rise by 0.3% m/m and 2.8% y/y, indicating a potential increase in the y/y rate of change in the months ahead.
• The PCE report could impact the 2-year treasury rate, 30-year treasury rate, US dollar, credit spreads, and the S&P 500.

Tomorrow's PCE report is expected to be another hot reading. Analysts estimate that the April headline PCE rose by 0.3% m/m and 2.7% y/y. Core PCE is expected to be hot as well, rising by 0.3% m/m and by 2.8% y/y. The numbers don't sound horrible, but with the Fed struggling to get inflation back to its 2% target, another month of a 0.3% gain will only push the Fed further away from its goal....

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