Sticky May PCE Reinforces Higher-for-Longer Fed as EURUSD Tests 1.13872

On June 26, markets digested the May PCE report showing inflation remained sticky with headline PCE at 0.4% m/m and 4.1% y/y and core at 0.3% m/m and 3.4% y/y. Resilient consumer spending and income both rose 0.7%, exceeding forecasts and keeping rate-cut expectations subdued. While the macro backdrop favors USD strength, EURUSD broke above its descending channel and tested resistance at 1.13872 with bullish short-term momentum. The two-day coverage highlights how the in-line but persistent inflation data has tempered easing bets without derailing the pair's technical breakout.