US Core PCE Preview: Forecasts from five major banks, Fed officials watch this measure

The Core Personal Consumption Expenditure (Core PCE), the Federal Reserve's preferred gauge of inflation, is set to show moderation in August after hitting 3.6% YoY in both June and July. The data is due out at 14:30 GMT and as we get closer to the release time, here are the forecasts of economists and researchers of five major banks.

In the view of FXStreet’s Analyst Yohay Elam, only a sharp fall in the Fed's favorite gauge could dethrone King Dollar.

TDS

“The core PCE price index appears to have risen more than the core CPI in August (an estimated 0.26% versus 0.10%), boosted by data from the PPI. The YoY change likely remained high at 3.6%.”

NBF

“The annual core PCE deflator may have pulled back by two ticks at 3.4%, still elevated on a historical basis.”

SocGen

“We do not anticipate much in the way of surprises, and the PCE deflator core and core deflator should track CPI gains of 0.3% MoM and 0.1% MoM well. The FOMC raised its current-year projection to 4.2% (4Q/4Q) for the PCE deflator. These monthly gains are consistent with that projection.”

CIBC

“Price pressures look to have remained steady in annual terms, with total PCE inflation likely running at 4.2%, while core PCE price inflation could have fallen by a tick while remaining well above the 2% target, at 3.5%.” 

Danske Bank

“We look for slight moderation and headline at 4.1% YoY and core at 3.4% YoY.”