PCE Inflation Holds At 3.4% In August While Core PCE Stays At 3%

US PCE inflation held at 3.4% in August versus 3.7% expected, the BEA said. Core PCE stayed at 3%, below the 3.3% estimate, and July was revised lower.

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Annual inflation in the United States (US), as measured by the change in the Personal Consumption Expenditures (PCE) Price Index, held steady at 3.4% in August, the US Bureau of Economic Analysis (BEA) reported on Wednesday. This reading came in below the market expectation of 3.7%, while July's print was revised lower to 3.4% from 3.7%.

In this period, the core PCE Price Index, which excludes volatile food and energy prices, stood unchanged at 3% and came in below analysts' estimate of 3.3%. Similarly, July's reading was also revised lower to 3% from 3.3%.

On a monthly basis, the PCE Price Index and the core PCE Price Index increased by 0.3% and 0.2%, respectively.

Other details of the publication showed that Personal Income rose by 0.2% on a monthly basis in August, while Personal Spending expanded by 0.9%.

Market reaction to US PCE inflation data

The US Dollar (USD) came under renewed selling pressure with the immediate reaction. At the time of press, the USD Index was down 0.3% on the day at 101.05.

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