The dollar strengthened after July’s core PCE rose 0.3%, lifting the annual rate to 2.9%, its fastest since February, reinforcing bets on a September 25 bps Fed cut. Consumer spending saw its strongest rise in four months, underscoring economic resilience despite soft labor data.
The euro edged to 1.1705 in Asia, supported by Fed cut bets despite firm July PCE inflation. Powell and Waller hinted at easing, while Lagarde’s remarks are awaited.
The July 2025 PCE report showed headline inflation up 0.2% MoM.