Goldman Sachs expects July core PCE inflation to rise 0.23% month over month, a level it says is slightly above both core CPI and market consensus, according to a BlockBeats report published on August 13. The forecast arrives as market attention pivots to the July core PCE data scheduled for release on August 26, following the latest CPI report. Within the details, Goldman attributes part of the projected increase to portfolio management fees, which it estimates will add 8 basis points, reflecting second-quarter equity market performance. The bank also cautioned that an upcoming change in methodology could introduce volatility into PCE readings and lower the annual core inflation rate. Looking further ahead, Goldman expects August core inflation to run near 0.2%. The firm believes the Federal Reserve will maintain interest rates at current levels through the end of the year. Taken together, the projections offer a two-month read on core inflation across July and August.
Goldman Sachs expects the July core PCE price index to rise 0.23% month over month, a pace slightly above both core CPI and market consensus. The forecast lands as attention shifts to the July core PCE release scheduled for August 26, following the latest CPI report.
The bank attributes part of the projected gain to portfolio management fees, which it estimates will add 8 basis points, reflecting second-quarter equity market gains. Goldman also cautioned that an upcoming methodology change could make PCE readings more volatile and reduce the annual core inflation rate.
For August, the firm expects core inflation to run near 0.2%. It believes the Federal Reserve will keep interest rates steady through the end of the year.
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