Preview: US August PCE to be released tonight at 20:30, may hardly serve as a basis for the Fed to pause rate hikes.

BlockBeats news, September 30: The U.S. August PCE price index will be released tonight at 20:30. The market expects that August PCE inflation will remain elevated, and the data may struggle to provide sufficient grounds for the Federal Reserve to pause further tightening.

Headline PCE is expected to rise 0.4% month-on-month and 3.7% year-on-year, both broadly unchanged from July; core PCE, excluding food and energy, is expected to rise 0.3% month-on-month and 3.3% year-on-year, still above the Federal Reserve's 2% inflation target.

The rebound in energy prices and resilient consumption may make the Federal Reserve's policy judgment more difficult. If the data meet expectations, the market may continue to focus on whether the Federal Reserve will raise rates again this year. At its September meeting, the Federal Reserve raised the policy rate by 25 basis points to 3.75%-4.00% and hinted in its latest projections that there is still room for further adjustment before the end of the year.

There are divisions within the Federal Reserve over the subsequent policy path. Federal Reserve Governor Barr believes that tariffs and the Iran conflict have pushed inflation off the track toward the 2% target, and further rate hikes may still be needed in the future; New York Fed President Williams said there is no need to act hastily, but he expects one more rate hike may still be needed this year. If PCE comes in above expectations, market pricing for further rate hikes may strengthen.