The Core PCE price index for July increased 2.6% lower than the expected 2.7% on an annual basis.

• The Core (excludes volatile food and energy prices) PCE price index for July increased 2.6% lower than the expected 2.7% on an annual basis.
• PCE MoM is 0.2% vs 0.2% Expected
• FOMC focuses on PCE inflation in its quarterly economic projections and also states its longer-run inflation goal in terms of headline PCE. PCE inflation has been preferred over CPI since 2000 for three main reasons:

1. The expenditure weights in the PCE can change as people substitute away from some goods and services for others
2. PCE includes more comprehensive coverage of goods and services
3. Historical PCE data can be revised more than for seasonal factors only

• This report should show inflation is controlled enough for the Fed to cut rates in September.

https://www.bea.gov/news/2024/personal-income-and-outlays-july-2024