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US Stocks Soar as Cooling Inflation Eases Rate Hike Fears
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CNBC TV18•30-09-2026, 19:41
US Stocks Soar as Cooling Inflation Eases Rate Hike Fears
- •US stocks opened higher after August PCE inflation data came in below expectations, easing concerns about further Federal Reserve rate hikes.
- •The Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all saw gains at the open.
- •The personal consumption expenditures (PCE) price index rose 3.4% year-on-year in August, lower than July's 3.7% and economists' forecasts.
- •Core PCE, excluding food and energy, also slowed to 3% from 3.3% in July, below economists' predictions.
- •Softer inflation data led to lower Treasury yields, with the 10-year yield retreating from its highest level since 2007, and reduced expectations for a Fed rate hike next month.
Key Questions Answered
US stocks opened higher while Treasury yields retreated from their highest levels since 2007 following the August PCE inflation report, which showed cooler-than-expected price increases.
The personal consumption expenditures (PCE) price index rose 3.4% year-on-year in August, slowing from 3.7% in July. Meanwhile, core PCE, which excludes food and energy, rose 3% from a year earlier, down from 3.3% in July.
Traders priced in a 35% chance of a quarter-point rate hike for the following month, down from 51% a day earlier according to the CME Group's FedWatch tool, though expectations for a December rate increase remained.
