Highlights
The Commerce Department reported yesterday morning the personal consumption expenditures (PCE) price index, the Federal Reserve's preferred inflation gauge, edged 0.1% higher last month after being unchanged in May, matching market expectations. The data likely sets the stage for the Fed to begin cutting rates in September, as the market widely expects.
In the 12 months ending in June, the PCE price index climbed 2.5%, down from 2.6% in May.
The inflation news sent stock market indexes screaming higher as the market expected lower interest rates in September, which should have sent commodities higher. But August options expiration, concerns about China’s potential lack of demand, and an increased chance of rain in the Eastern Corn Belt this coming week sent corn, beans and wheat sharply lower, with the winter wheat making new contracts lows for the year.