When will be the Personal Consumption Expenditures Price Index report released and how could it affect EUR/USD?

The PCE Inflation report is slated for release at 12:30 GMT, on July 28. Following the dovish Fed and strong US economic data, the US Dollar clings to recovery gains, keeping EUR/USD in weekly lows on the 1.0900 level.. Markets continue pricing a probability of 22% and 30% for rate hikes by the Fed in September and November respectively.

The United States economy surprisingly accelerated to a 2.4% annual growth rate in the June quarter vs. 1.8% expected and a 2.0% growth recorded in the first quarter. According to the US Department of Commerce, in seasonally adjusted term Durable Goods Orders jumped 4.7% on a monthly basis to reach $302.5bn. Meanwhile, the latest data published by the US Department of Labor (DOL) showed that Initial Jobless Claims decreased by 7,000 to 221,000 in the week ending July 22. 

The US Dollar could extend its weekly gains in case the monthly Core PCE inflation surpasses the expected 0.2% increase in the reported period. Hot inflation data could strengthen bets for a September rate increase by the Fed. On the other hand, softer-than-expected inflation figures are likely to renew the downside in the Greenback.

FXStreet Analyst Dhwani Mehta offers a brief technical outlook for EUR/USD and explains: “Having breached the critical 21-day Simple Moving Average (SMA) on a daily closing basis on Thursday, Euro sellers are extending control heading toward the US PCE Inflation data release. The 14-day Relative Strength Index (RSI) on the daily chart is sitting below the 50 level, adding credence to the bearish bias.”

Dhwani also highlights the important technical levels for EUR/USD: “On the downside, initial technical support is seen at the confluence of the 50 and 100 DMAs near 1.0910.. A daily close below that level could intensify selling pressure, fuelling a fresh downtrend toward the July 6 low of 1.0833.”

About the Core Personal Consumption Expenditures Price Index

The Core Personal Consumption Expenditures released by the US Bureau of Economic Analysis is an average amount of money that consumers spend in a month. "Core" excludes seasonally volatile products such as food and energy in order to capture an accurate calculation of the expenditure. It is a significant indicator of inflation. A high reading is bullish for the USD, while a low reading is bearish.