BEA Annual benchmark revisions lower core PCE growth, analysts say October Urgency of another rate hike eases
BIBIBI
AT A GLANCE
core PCE slowed year over year to 3%, which the analysts believe has to some extent reduced the urgency for the October to raise rates again.
Article
Analysts: Inflation remains elevated, but the cooling has exceeded expectations
BlockBeats news,September 30, analysts at Bank of Montreal noted in a research report that the annual benchmark revisions from the U.S. Bureau of Economic Analysis (BEA) showed that the downward revision to the Federal Reserve’s preferred inflation gauge was larger than expected, although inflation remains well above the Federal Reserve’s 2%target. The analysts said that August core PCE(the Personal Consumption Expenditures Price Index) growth was lower than expected, slowing year over year to 3%, below the market consensus of 3.3%and the Federal Reserve’s own forecast of 3.2%.
At the same time, they noted that the economy continues to expand and that hiring activity in the private sector remains robust. The analysts believe that these factors, together with the downward revision to the inflation data, have to some extent reduced the urgency for the October to raise rates again.
Original link https://m.theblockbeats.info/flash/369815
Key points
01
The annual benchmark revisions from the U.S. Bureau of Economic Analysis (BEA) showed that the downward revision to the Federal Reserve’s preferred inflation gauge was larger than expected.
02
The analysts said that August core PCE year-over-year growth slowed to 3%。
03
3%’s core PCE year-over-year growth was below the market consensus of 3.3%, and also below the Federal Reserve’s forecast of 3.2%。
04
The analysts noted that the economy continues to expand and that hiring activity in the private sector remains robust.
05
The analysts believe that the economic expansion, robust hiring, and downward revision to the inflation data have to some extent reduced the urgency for the October to raise rates again.
AI-assisted interpretation
The following is analysis, separate from reported facts. Verify important claims independently.
core PCE is an indicator used to track changes in prices. The reported 3%was below the market’s and the Federal Reserve’s previous forecasts, indicating that inflation cooled more than expected; however, it remains above the Federal Reserve’s 2%target. Based on this, Bank of Montreal analysts believe that October raising rates again is less urgent, though this is only the analysts’ assessment.
Why it matters to readers
Inflation data affect market expectations about whether the Federal Reserve will raise rates. This data came in below expectations and may change expectations regarding the October policy decision, but the original text does not provide an actual policy decision or market price movement.
Beginners can understand this news as follows: The pace of price increases has slowed, but has not yet returned to the Federal Reserve’s target; “reduced urgency for a rate hike” does not mean that it has been determined that rates will not be raised.
Risks and unknowns
The content was relayed by BlockBeats from a research report by Bank of Montreal analysts; the original research report was not provided for verification.
The report does not state the Federal Reserve’s October final policy decision.
The original text does not provide market price, yield, or capital flow data, so it is impossible to confirm the actual impact of this news on specific assets.
The evidence only states September 30, without specifying the year.
Related Developments
Loading event timeline…
Related concepts
core PCE
This term is not in the glossary yet. Browse related concepts in the glossary.
