Here’s How the Stock Market Is Moving Ahead of Key Inflation Report
U.S. equity markets edged up early Friday as traders shifted focus to the upcoming Personal Consumption Expenditures (PCE) report — a crucial inflation gauge that could shape expectations for the Federal Reserve’s next move on interest rates.
Futures tied to the Dow Jones Industrial Average gained around 0.3%, while those tracking the S&P 500 and Nasdaq 100 posted modest increases of 0.3% and 0.2%, respectively. The cautious uptick comes as investors weigh how today’s inflation reading might influence the central bank’s policy outlook, particularly amid growing speculation that rate cuts could arrive sooner than previously expected.
Markets have shown resilience throughout the week, shaking off global trade concerns and geopolitical tensions. Much of the optimism stems from growing hopes that inflation may be cooling enough to justify monetary easing later this summer.
The PCE data — due later today — is seen as a key test. While consumer prices have moderated over the past year, recent warnings from Fed Chair Jerome Powell suggest policymakers remain wary of lingering inflation risks, especially in light of ongoing tariffs that could reaccelerate price growth.
Adding to the complexity is a fresh update on trade negotiations. President Trump indicated that a deal has been signed with China, though details remain vague. According to reports, the agreement includes an extension of tariff relief for countries engaged in talks with the U.S., potentially easing some inflationary pressure in the near term.
Still, all eyes remain on today’s inflation figures. A softer-than-expected print would likely reinforce market conviction that the Fed will move toward cutting rates, possibly as early as July. On the other hand, any upside surprise in prices could push back those expectations — and rattle a market that’s been pricing in dovish policy.
Friday’s session is expected to be driven by macroeconomic sentiment, as investors look for confirmation that the inflation backdrop is indeed cooling. Until then, the tone remains cautious — but optimistic.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
