ME News reports that on July 31 (UTC+8), the U.S. June PCE price index declined 0.1% month-over-month, marking the first monthly drop in four years, with the year-over-year growth rate falling to 3.7%; core PCE rose 0.1% month-over-month and stood at 3.3% year-over-year, both indicating easing inflationary pressures. During the same period, U.S. June personal consumption expenditures increased 0.3% month-over-month, personal income rose 0.2%, and the savings rate dropped to 2.7%, hitting a four-year low. Despite the cooling inflation, the Federal Reserve held interest rates steady at its July meeting. Market expectations for future policy paths remain divergent: JPMorgan expects the Fed to hike rates by 25 basis points in December and believes a rate hike in September remains possible if inflation reignites; Goldman Sachs and Barclays anticipate no rate changes this year; Bank of America forecasts three cumulative rate hikes starting in September; while Citigroup still maintains its forecast for consecutive rate cuts in October, December, and January 2027. CME FedWatch data shows that the market currently prices in a 65.2% probability of a rate hike in September, down from levels prior to the policy announcement. (Source: BlockBeats)
U.S. June PCE Shows First Quarterly Decline in Four Years; Market Divided on Fed Policy Path
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Summary
On-chain data shows the U.S. June PCE price index declined 0.1% month-over-month—the first drop in four years—with annual growth at 3.7%. Core PCE rose 0.1% monthly and 3.3% annually. Personal spending increased 0.3%, while savings hit a four-year low of 2.7%. The Fed held rates steady in July. On-chain analysis indicates divergent market views: JPMorgan anticipates a 25-basis-point hike in December, while Goldman Sachs and Barclays expect no rate changes this year. CME FedWatch data currently assigns a 65.2% probability of a September hike, down from earlier levels.
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