Overview

• The BEA said headline PCE rose 2.7% year over year in August with core at 2.9%, as monthly gains registered 0.3% and 0.2% respectively.
• Personal spending increased 0.6% and income rose 0.4%, with the saving rate at 4.6%, reflecting continued consumer resilience.
• Futures and yields signaled confidence in additional easing as CME FedWatch showed high probabilities for an October rate cut.
• Analysts noted tariff pass-through is building and highlighted new duties on trucks, cabinets and branded drugs as potential sources of further price pressure.
• An upward revision put Q2 GDP at a 3.8% annualized pace, even as University of Michigan consumer sentiment fell to 55.1.