Federal Reserve Chair Jerome Powell indicated on Friday that the central bank’s preferred inflation measure aligned closely with their expectations. Powell emphasized that it would not be prudent to lower interest rates until there is certainty that inflation is under control. Market sentiment suggests investors are anticipating the US central bank to enact its first rate cut in June.
The core personal consumption expenditures (PCE) price index, excluding volatile food and energy costs, posted a 0.3% increase in February, marking its most significant consecutive rise in a year. On an annual basis, the index is up by 2.8%, surpassing the Fed’s 2% target. Despite this, the dollar maintained stability.
In the commodities market, iron ore prices plummeted to their lowest level in 10 months, driven by ongoing concerns surrounding China’s prolonged property crisis, which continues to weigh on prices. Meanwhile, gold extended its rally, propelled by mounting expectations of rate cuts by the Federal Reserve and escalating geopolitical tensions.