US Core PCE continues to rise; puts more pressure on Fed
As the Fed continues to catch up with the rest of the markets in realizing that inflation is indeed high, it now has another data point to refer to, Core PCE.
Share this:
It’s not a secret that inflation has been high in the US. US CPI and Core CPI has been on the rise for months. Today, the US released what is considered to be the Fed’s favorite measure of inflation for February, Core PCE (Price Consumption Expenditure) Price Index. The print was 5.4% YoY vs 5.2% YoY in January. Although this was a touch weaker than the 5.5% YoY expectation, it is still the highest level since April 1983. It should be noted that the headline PCE Price Index was 6.4% YoY vs 6.0% YoY in January. This was the highest level since February 1982. In addition, Personal Income for February was 0.5% MoM vs 0.1% MoM in January, while personal spending took a dive, up only 0.2% MoM vs 2.7% MoM in January. One has to consider how much of an impact rising prices played in the lower personal spending print.
NZD/USD has been trading in a long-term downward sloping channel since the beginning of 2021, when prices reached a high of 0.7465. On January 26th, price posted a false breakdown below the bottom of the channel and reached a low of 0.6507. Since then, NZD/USD has been moving higher and it’s currently trading near the 61.8% Fibonacci retracement level from the highs of October 29th, 2021 to the low of January 26th, near 0.6950. Yesterday, price briefly rose to the psychological round number resistance of 0.7000 before retreating today. The top trendline of the long-term channel comes in just above near 0.7045 and acts as the next level of resistance. If price trades above the channel line, horizontal resistance is at 0.7073. Above there NZD/USD has room to run up to the October 29th, 2021 highs at 0.7224.
Source: Tradingview, Stone X
On a 240-minute timeframe, NZD/USD is in an ascending wedge pattern. The target on the break of an ascending wedge is a 100% retracement , or 0.6726. However, if price is to reach that level, it must first break the bottom, upward sloping trendline of the wedge near 0.6915. Below there is horizontal support at 0.6875, then the 50% retracement level from the lows of March 15th to the highs of March 30th near 0.6832.
Source: Tradingview, Stone X
As the Fed continues to catch up with the rest of the markets in realizing that inflation is indeed high, it now has another data point to refer to, Core PCE. The Fed doesn’t meet again until May. However, one has to consider the odds that the Fed may hike 50bps at the meeting, or possibly even hike inter-meeting!
It’s not a secret that inflation has been high in the US. US CPI and Core CPI has been on the rise for months. Today, the US released what is considered to be the Fed’s favorite measure of inflation for February, Core PCE (Price Consumption Expenditure) Price Index. The print was 5.4% YoY vs 5.2% YoY in January. Although this was a touch weaker than the 5.5% YoY expectation, it is still the highest level since April 1983. It should be noted that the headline PCE Price Index was 6.4% YoY vs 6.0% YoY in January. This was the highest level since February 1982. In addition, Personal Income for February was 0.5% MoM vs 0.1% MoM in January, while personal spending took a dive, up only 0.2% MoM vs 2.7% MoM in January. One has to consider how much of an impact rising prices played in the lower personal spending print.
NZD/USD has been trading in a long-term downward sloping channel since the beginning of 2021, when prices reached a high of 0.7465. On January 26th, price posted a false breakdown below the bottom of the channel and reached a low of 0.6507. Since then, NZD/USD has been moving higher and it’s currently trading near the 61.8% Fibonacci retracement level from the highs of October 29th, 2021 to the low of January 26th, near 0.6950. Yesterday, price briefly rose to the psychological round number resistance of 0.7000 before retreating today. The top trendline of the long-term channel comes in just above near 0.7045 and acts as the next level of resistance. If price trades above the channel line, horizontal resistance is at 0.7073. Above there NZD/USD has room to run up to the October 29th, 2021 highs at 0.7224.
Source: Tradingview, Stone X
Trade NZD/USD now: Login or Open a new account!
• Open an account in the UK
• Open an account in Australia
• Open an account in Singapore
On a 240-minute timeframe, NZD/USD is in an ascending wedge pattern. The target on the break of an ascending wedge is a 100% retracement , or 0.6726. However, if price is to reach that level, it must first break the bottom, upward sloping trendline of the wedge near 0.6915. Below there is horizontal support at 0.6875, then the 50% retracement level from the lows of March 15th to the highs of March 30th near 0.6832.
Source: Tradingview, Stone X
As the Fed continues to catch up with the rest of the markets in realizing that inflation is indeed high, it now has another data point to refer to, Core PCE. The Fed doesn’t meet again until May. However, one has to consider the odds that the Fed may hike 50bps at the meeting, or possibly even hike inter-meeting!
Learn more about forex trading opportunities.
Related tags:
Latest market news
The complete CFD trading experience
Award-winning platforms, competitive spreads, low commissions and dedicated support.
We live and breathe the markets and are dedicated to helping traders realise their ambitions as we continue to set the industry bar.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
EUR/USD weekly outlook: Oil, inflation and NFP in focus
After coming under significant pressure in recent weeks, the EUR/USD came off its lows to finish the week on a positive note on Friday, albeit with only a mild rebound. That was not enough to prevent the exchange rate falling for the third consecutive week, as the US dollar and bond yields rallied across the board.
Gold Q4 2026 outlook: Resilience in the face of rallying dollar and yields
As we headed towards the latter stages of Q3 and into Q4, the Fed had just hiked rates in a hawkish FOMC meeting, while the likes of the ECB and BoJ had also tightened their respective policies. Oil prices remained elevated amid the prolonged US-Iran conflict. Meanwhile, bond yields were breaking out, and the dollar was higher across the board. Yet, remarkably, gold was still holding in the positive territory for the third quarter, even if it had weakened somewhat in September.
EUR/USD Q4 2026 Outlook: Euro at a Crossroads as Fed, ECB Tighten 9 25 2026
EUR/USD enters Q4 at a pivotal inflection point as competing Fed-ECB policy paths and persistent inflation risks collide with major technical support.
StoneX Europe Ltd may make third party material available on this website which may contain information included but not limited to the conditions of financial markets. The material is for information purposes only and does not contain, and should not be construed as containing, investment advice and/or investment recommendation and/or an investment research and/or an offer of or solicitation for any transactions in financial instruments; any decision to enter into a specific transaction shall be made by the client following an assessment by him/her of their situation.
StoneX Europe Ltd makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplied. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. We are not under any obligation to update any such material. Any opinion made may be personal to the author and may not reflect the opinion of StoneX Europe Ltd.