US core PCE index YoY for June: 2.6% vs. 2.5% estimate

• Basic PCE of the previous month: 2.6%
• Core PCE month-over-month increased 0.2% compared to the estimate of 0.1%. The unrounded figure is lower than the 0.2% increase, or 0.188%.
• Baseline PCE urine analysis of 2.6% versus estimate of 2.5%. Last month, 2.6%
• PCE MoM 0.1% vs. 0.1% estimate. Unrounded figure was less than 0.1%, or 0.0788%
• PCE YoY 2.5% vs. 2.5% estimated and 2.6% previously
• Personal income +0.2% against 0.4% estimated. The previous month, the forecast had been revised downwards, from 0.5% to 0.4%. Wages and salaries increased by 0.3%.
• Personal spending 0.2% versus 0.4% last month (revised from 0.3%).
• The savings rate stood at 3.4% compared to 3.5% last month

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Other views:

• Three-month annualized inflation rate of 2.3% versus 2.9% previously.
• 6-month annualized rate for core PCE of 3.4% versus 3.3% previously.

Core PCE was slightly better than expected, consistent with core PCE data released in yesterday’s GDP report.

Looking at the markets, yields remain lower:

• 2-year yield 4.412%, -3.1 basis points
• 5-year yield 4.106%, -2.7 basis points
• 10-year yield 4.221%, -2.5 basis points
• 30-year yield 4.465%, principal 0.5 basis points

Let’s look at stock futures:

• Dow Industrial Index Average +254 points
• S&P 43.03 points
• NASDAQ index up 200.92 points

The Fed is targeting a 67 basis point rate cut by year-end, with a September cut priced in. That’s little change from pre-publication levels.