PCE Inflation Report to Set Fed Tone for EUR/USD
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All eyes turn to Wednesday's PCE Price Index, the Federal Reserve's preferred inflation gauge, as consensus estimates are weighed against recent dovish signals from FOMC minutes. For EUR/USD traders, the outcome carries outsized weight in shaping near-term Fed policy expectations.
A softer core PCE reading would reinforce bets on a slower tightening path, likely extending EUR/USD's recovery against the dollar. A stronger print, however, risks reviving hawkish repricing and pressuring the pair lower.
Accompanying personal income and savings data will add further texture to the demand-side inflation picture, with markets parsing every detail for clues on the Fed's next move and its knock-on effect for the single currency.