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Core PCE Inflation Ahead

US DATA
  • Core PCE inflation for July lands shortly, with consensus for 0.2% M/M after 0.165% M/M in June.
  • We know from yesterday’s 2nd Q2 release that there will be net downward revisions (revised down from 3.83% to 3.69% annualized in Q2), and will find out how they were distributed over the quarter (currently 0.35% April, 0.31% May and 0.165% Jun).
  • Non-housing core services will as always get attention with some looking for a bounce to circa 0.5% from 0.22% M/M in June and 0.23% in May. The potential rise is seen on the back of the stronger portfolio management component following higher stocks and with added help from stronger health care services.

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