US Inflation Data - Core Personal Consumption Expenditures (PCE) Index, the inflation indicator prioritized by the US Federal Reserve (Fed), will be released on Friday by the US Bureau of Economic Analysis (BEA) at 13:30 GMT (21:30 WIB).
 
What is anticipated from the PCE inflation report favored by the Federal Reserve?
 
The Core PCE Price Index, which excludes food and energy price fluctuations, is considered a more significant inflation benchmark in the context of Fed policy. In December, it is expected that the index will see an increase of 0.2% month-on-month, slightly up from the growth of 0.1% recorded in November. The annual growth of the Core PCE for December is projected to reach 3%, down from November’s figure of 3.2%. The main PCE Price Index is expected to rise by 2.6% (YoY).
 
In reviewing the PCE inflation report, “[We] expect the December PCE data to continue supporting the idea of slowing inflation, with core series growth approaching a month-on-month trend of 0.2% — and below the Core Consumer Price Index (CPI) increase of 0.3%,” said analysts from TD Securities in a weekly report titled "Next Week: US Macro Market Movers."
 
The PCE inflation report is scheduled for release at 13:30 GMT (21:30 WIB) and could influence EUR/USD. The monthly Core PCE, favored by the Fed, is considered a clean inflation indicator as it is not affected by base effects. Although quarterly data is included in the GDP report, investors remain focused on the monthly Core PCE.
 
However, no significant surprises are anticipated as quarterly figures are already reflected in the GDP report. Market attention is more directed toward Personal Spending and Personal Income for December. Personal Spending is expected to rise by 0.4%, while Personal Income is projected to increase by 0.3%. Disappointing results could weaken the USD, while optimistic outcomes are likely to support it.
 
FXStreet analyst Eren Sengezer provided a brief technical outlook for EUR/USD, with the RSI indicating a lack of buying interest. The 200-day SMA at 1.0850 serves as a pivot level, with potential bearish targets at 1.0780-1.0770. Strong resistance is seen at 1.0930-1.0950, while the psychological level of 1.1000 also remains in focus.
 
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Warning!
 
The analysis “US Inflation Data Declines: Core PCE Predicted to Plummet in December!” is based on fundamental and technical views from reliable sources and should not be considered advice or solicitation. Always remember that this content aims to enrich readers' information. Always conduct your independent research regarding other forex information to use as a reference in your trading.
 
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