The U.S. Bureau of Economic Analysis is set to release the latest Personal Consumption Expenditures (PCE) inflation data, with markets broadly expecting little progress on disinflation. Consensus forecasts place core PCE at around 2.8%–2.9% YoY, while headline PCE is expected near 2.7%—both still well above the Federal Reserve’s 2% long-term target and indicative of a prolonged high-level plateau.
Structurally, U.S. inflation remains caught between opposing forces. Tariff-related costs and selective goods pricing continue to provide a floor, while easing wage growth and slowing rent inflation are gradually cooling services inflation. The result is stabilization without a decisive downward break, further constraining monetary policy flexibility. Given recent data distortions caused by the government shutdown, this PCE print is more likely to confirm existing trends rather than alter policy direction.
Markets have largely converged on expectations that the Federal Reserve will keep rates unchanged next week, with implied probabilities approaching 95%. In the near term, elevated rates continue to cap risk asset valuations; over the medium term, sticky inflation without a clear growth downturn points toward a prolonged wait-and-see policy phase.
Bitunix Analyst View:
For crypto markets, a “higher-for-longer” rate environment limits near-term liquidity relief, keeping correlation with traditional risk assets intact. However, if inflation remains sticky while real rates peak, the medium- to long-term narrative for crypto as a hedge against monetary policy uncertainty could re-emerge. This PCE release is best viewed as a confirmation of the status quo—not a turning point. A true shift in market rhythm will depend on whether inflation can decisively break out of its current stalemate.
