Live Coverage: Core PCE and Personal Spending meet rattled markets

Yohay Elam FXStreet

How is the US consumer doing? That question is on markets' minds for quite some time. Apart from core PCE – the Fed's preferred inflation gauge – the Personal Spending figure is of high interest. They are published simultaneously and that means fireworks.

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Why these figures matter

The Federal Reserve (Fed) aims for 2% inflation – and its measure is the core Personal Consumption Expenditure (core PCE). While it is published after the Consumer Price Index (CPI) report, this seemingly lagging indicator matters – because the Fed says it does.

Core PCE is set to remain above the 2% YoY level, and any upside surprise may trigger worries of higher interest rates.

This time, Personal Spending will have its say. Similar to core PCE, it is a late look at consumption – but this time, it is of higher importance after the earlier Retail Sales report for January showed a substantial decline. Moreover, two consumer sentiment surveys declined sharply.

With end-of-month flows in the mix, volatility could explode.

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Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

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