The main attraction of today’s session is the Fed’s preferred gauge of inflationary pressures, the Core PCE index, for the month August whose results will have a direct impact on the Federal Reserve’s impending rate decisions in the remaining two meetings of 2025.
According to forecasts, year on year Core PCE reading is seen at the 2.9% level, making no virtual change from last month’s update, showcasing that economists do not currently have substantial evidence for an acceleration of price pressures due to Trump’s tariff agenda.
Shall we observe the aforementioned acceleration however, we would reasonably expect to see the greenback advancing further, US equities extending their loosing streak and gold futures heading towards a fresh record high. On the other hand, should inflationary pressures showcase deceleration, easing from the 2.9% level, odds for upcoming rate reductions by the Fed may solidify, the dollar’s rally coming to end and US equity markets rejoicing.
Growth in second quarter exceed expectations and was upwardly revised according to the second estimate, up from -0.5% contraction of the prior quarter to the 3.8% level (vs 3.3% forecast) and gave the greenback a boost, lifting it from further north from 3-week lows. The report also showcased that the US economy remains robust and resilient, dispelling fears for an immediate fallout.
Technical Analysis
Sliver Chart – Silver futures relentlessly capture new heights, bullish momentum lifts them closer to all time highs
Resistance: 46.00 (R1), 47.00 (R2), 48.00 (R3)
Support: 44.00 (S1), 42.70 (S2), 41.70 (S3)