US Core PCE Inflation Slows to 3.0% as Consumer Spending Beats Forecasts

U.S. core personal consumption expenditures inflation slowed to 3.0% year-over-year, undershooting the 3.3% consensus forecast and hitting a six-month low. On a monthly basis, core PCE rose 0.2% versus expectations of 0.3%. Headline PCE climbed 0.3% month-over-month and 3.4% annually, below the 3.7% projection. Personal spending remained strong, accelerating 0.9% against a 0.8% forecast, while personal income missed estimates with a 0.2% gain. Softer inflation reduced expectations of further Federal Reserve monetary tightening, sending market odds for an October rate hike tumbling to 34% from 64%. Gold and equities gained, while the dollar weakened.