Today, September 30, at 15:30 MSK, the US releases the core personal consumption expenditures price index, Core PCE, for the month. Forecast 0.3% versus 0.2% a month earlier. The importance of the event is high: it is this inflation indicator that the Fed looks at first and foremost.
What this indicator is
Core PCE m/m shows the increase in prices over one month for the basket of what Americans actually spend money on, excluding food and energy. Their prices change the most and can distort the overall picture. Unlike the better-known CPI, it is Core PCE that the Fed incorporates into its inflation forecasts.
Why the market is nervous
The consensus of 0.3% is higher than the previous 0.2%, meaning analysts expect an acceleration in monthly price growth. For the market, not only the indicator itself matters, but also the difference between the actual figure and the forecast. A deviation of even 0.1 percentage point could change expectations for the future path of the Fed rate.
What is in focus
The dollar and the currency pairs DXY, EUR/USD and USD/JPY, gold XAU/USD, the S&P 500 and Nasdaq indices, as well as the cryptocurrencies BTC and ETH may react to the release. In recent months, the crypto market has also been reacting to US inflation data along with the stock market.
Possible scenarios
Scenario A: the actual figure matches the forecast. The impulse may turn out to be short, after which the movement gradually fades and the market returns to the range. Scenario B: the indicator deviates from the forecast in either direction. In the first minutes, sharp moves, widening spreads, level breaks and stop triggers are possible.
What's next
The main reaction usually occurs in the first 1-5 minutes after 15:30 MSK. Then the market begins to reassess rate expectations for the next Fed meeting. We do not predict the direction in advance. It is more important to take into account the possible increase in volatility after the release.
Do you trade the data release at 15:30?
A familiar picture: you sit without a position, wait for the number, then catch the first impulse and hope the spread doesn't knock you out. But some prop firms consider such trades a violation. Somewhere news trading is fully allowed, while elsewhere there are restrictions on opening or holding a position immediately before a data release. This is checked before buying a challenge, not after the first disconnection. The selection takes a minute and immediately filters out programs where this trading style is restricted.