Core PCE figures seem to suggest an interest rate cut at the September FOMC

The market will be quiet today as the US celebrates Labor Day. ?US yearly Personal Consumption Expenditures price index grew by 2.5% in July in-line with expectations and core PCE also remained at 2.6%. However, monthly PCE climbed from 0.1% to 0.2% in July. Also, consumer spending surged by 0.3% in July. Overall, these figures do not seem to suggest that the Fed will review its potential interest rate cut of 25 basis points unless US job market data due this coming Friday indicate otherwise. The greenback was trading at 101.66 at the time of writing as geopolitical tensions show no signs of subsiding in the near term.

Harmonised Index of Consumer Prices suggested progress in the fight against Eurozone inflation last Friday. ?ECB board member Isabel Schnabel acknowledged that inflation is sliding in the Eurozone in the context of an event. While she did mention incoming interest rate cuts, she seemed to exercise the same caution when talking about easing monetary policy as ECB? chief Lagarde and other ECB officials. Eurozone preliminary annual inflation slid from 2.9% to 2.8% in August and Eurozone preliminary core inflation slipped from 2.6% to 2.2% in the same period. ?Manufacturing PMI for France, Germany, Italy and the Eurozone and Italian GDP and Producer Price Index are due today. The fibre is currently trading at 1.1063.