#USMayPCEInflationRisesTo4.1%HighestIn3Years


🌡 PCE Hit 4.1%. Highest in 3 Years. And With the Ceasefire Now Fracturing the Inflation Picture Just Got Significantly More Complicated

This PCE news came out on Thursday and I want to give you the latest information on what it means today. The situation has changed a lot in the 3 days.

* May PCE rose 4.1% compared to year. The highest since April 2023.

* Core PCE was 3.4%. The highest since October 2023.

* Both numbers were higher than expected.

* The dollar index went up to 101.52, its highest in a year.

* Gold prices fell to near a 7-month low.

The main reason for this was energy. The conflict in the Middle East is pushing oil prices up which affects inflation. People thought that a ceasefire between the US and Iran on June 17 would bring energy prices down and make the June PCE reading lower.

Now that ceasefire is falling apart. The US attacked military targets on June 26 after Iran attacked commercial ships. Iran says the US attack broke the ceasefire. A tanker carrying 2 million barrels of crude was attacked.

This changes everything for the inflation outlook and for the assets we're trading. If the situation in the Strait of Hormuz gets worse oil prices will go up. If oil prices go up the June PCE reading might be higher than Mays 4.1%. If that happens the Fed might raise interest rates more.

The Fed is already being careful about inflation. They had their meeting last week and inflation was their main concern. Three high inflation readings. 4.2% For CPI 5.2% for PPI and 4.1% for PCE. All at the time means they can't ignore it.

The next meeting on July 29-30 is important. There are two scenarios for the next six weeks.

* Scenario one: The Doha talks succeed the Strait of Hormuz opens, oil prices fall the June PCE reading is low. The Fed doesn't raise interest rates.

* Scenario two: The Doha talks fail the conflict gets worse oil prices stay high the June PCE reading is high. The Fed raises interest rates.

The future of crypto depends on what happens in Doha this week. We need to be prepared for both scenarios.

With PCE, at 4.1% and the ceasefire now fracturing. Which scenario are you preparing for: Doha success or re-escalation?

#GateSquare #MacroCrypto
@Gate_Square
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Miss_1903
· 3h ago
To The Moon 🌕
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HighAmbition
· 3h ago
good information 👍👍
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