Will Core PCE MoM be 0.2% in August?

Analysis

Core PCE rose 0.2 percent in July. The annual rate has held near 3.3 percent for four straight months. That persistence suggests underlying price pressure has not meaningfully eased. To keep the annual rate steady, monthly increases need to average closer to 0.27 percent. That makes a 0.3 percent August reading a stronger contender than a repeat of July's figure. Federal Reserve officials speaking after the Jackson Hole gathering in late August leaned hawkish. That tone typically surfaces when incoming data looks firmer rather than softer. Resilient consumer spending and a stable labor market reinforce that picture. Nothing in the recent evidence points toward a clean disinflationary month. Forecasters are currently split close to evenly between 0.2 and 0.3 percent. That split itself signals this is not a straightforward repeat scenario. Monthly inflation prints carry enough noise that landing on the exact same rounded figure two months running is the less likely outcome, not the default one. Add in the categories capturing 0.1 percent or swings below and above that range, and the field of alternatives to 0.2 percent looks wider than any single outcome. The August CPI report due September 11 is the key data point ahead of the September 30 BEA release. If its components come in firm, that points toward core PCE drifting to 0.3 percent rather than repeating July's number. Watch that CPI print closely for early signals.