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The Federal Reserve’s preferred inflation gauge came in as expected this morning: Monthly core PCE inflation for July was 0.2%, and annual was 3.3%, both matching consensus forecasts. Headline ticked up to 0.2% monthly (-0.1% prior and 0.1% expected), leaving the annual figure unchanged at 3.7%. None of this changed market expectations for a September Fed rate hike, which, at around 40%, still feels too high to me. Elsewhere in this morning's data, flat consumer spending reinforces the recent stretch of softer-than-expected economic activity indicators. #economy #markets #federalreserve #inflation