US: PCE inflation data in focus – Danske Bank

Analysts at Danske Bank point out that in the US, we get the most important release of the week namely PCE inflation for August and he estimate a slight uptick in the monthly increases of both PCE headline and PCE core following the release of the surprisingly high increase in CPI (CPI and PCE numbers tend to follow each other).

Key Quotes

“The monthly increase in the CPI numbers leads us to believe the PCE headline will increase 0.3% m/m (1.5% y/y versus 1.4% in July) and PCE core 0.2% m/m (1.4% y/y versus 1.4% in July). Note that although this relatively strong monthly print in the PCE core does not lead to increases in the yearly rate, this has to do with a very large monthly increase in August 2016.”

“We also get the final University of Michigan consumer confidence. The preliminary number showed a fall compared with August but the index is still at a high level, pointing to solid growth in private consumption. The Chicago manufacturing PMI for September is also due for release.”