The Fed'S Interest Rate Increases Are Complicated And Uncertain.

On Friday (August 28th), the US PCE core price index for July, which was released at the beginning of the New York session, was less than expected. Personal income in July was in line with expectations. After the release of the data, Fed officials expressed different views on the rate hike.

Next week, we will issue important economic data such as ADP employment and non farm employment. Here we will make a brief forecast for next Monday's important economic data.

PCE is the abbreviation of Personal Consumption Expenditure Price Deflator. It is an important basis for the Federal Reserve to consider the economic growth and adjust the rate of interest increase.

In July, the core PCE price index was less than expected, indicating that the US economy has a certain distance from the inflation standard, which has cast a shadow over the rate increase during the year.

The US core PCE price index released in New York during the period of July is less than expected, with an expected growth of 1.3% and a real growth of 1.2%.

Meanwhile, the US personal income monthly rate rose 0.4% in July, which is in line with expectations.

After the release of the data, Kocherlakota, chairman of Minneapolis Fed chairman, pointed out that inflation is still relatively low, and that inflation will reach (2%) target will take some time, this time may be years.

He said he did not think that raising interest rates in the near future would be a good move, and raising interest rates this year is not a good idea. Now raising interest rates will damage the credibility of 2% of the price targets.

He also pointed out that the global economic slowdown and

Volatility poses a tail risk to the US outlook, and the current situation calls for more loose measures.

However, Meister, chairman of the Cleveland fed, held different views. She pointed out that there is reason to believe that inflation will return to 2%, and that the US economy can bear interest rates. The Fed must raise interest rates before the targets are met.

Besides,

President Brad pointed out that China's deflation will not have a great impact on the United States on inflation, and that FOMC probably will not see the recent shocks as a change in the economic outlook, nor should the recent shocks affect the US economic trajectory.

He said recently that the United States

Improvements (including the second quarter revised growth rate of 3.7%) offset the worries about China's economy and the turmoil in the US financial market.

But he also said that if the market continues to run unsteadily through the September monetary policy conference, the Fed will hesitate to raise interest rates.

Subsequently, Reuters commented that the data, though not as expected, still rose, mainly due to the largest increase in car consumption, almost half of the increase. In addition, the US payroll growth has recorded the fastest growth since November last year, and the pre tax personal pay increased by 0.4%, which stimulated the American people to accelerate consumer spending and played a positive supporting role in the third quarter economic growth of the United States.

In addition, the VIX index (panic index) of the Chicago Board Options Exchange opened 2.49% higher than the previous trading day and was 26.76%, indicating that market confidence was slightly affected.