US Inflation Slows, GDP Revised Up, and Job Growth Rebounds, Boosting Stocks and Easing Yields

The August Personal Consumption Expenditures (PCE) price index, a key inflation gauge for the Federal Reserve, came in lower than expected, with headline PCE rising 0.3% monthly and core PCE (excluding food and energy) rising 0.2%. This was below economists' forecasts of 0.4% and 0.3% respectively. Additionally, the government's final third-quarter gross domestic product (GDP) estimate was revised up to 2.2% on a quarter-over-quarter annual basis from a prior 1.5%. Private sector employment also saw a significant jump in September, with ADP reporting 90,000 new jobs, exceeding the consensus of 58,000. These positive economic data releases led to a rise in major stock indexes and a slight easing of Treasury yields.