PCE Report Says Inflation Isn’t a Problem. The Bond Market Disagrees.

Wall Street is finding the challenge of parsing delayed economic data even more frustrating this week, with stock markets cheering a muted Friday inflation report and bond investors dumping Treasuries amid concerns that price pressures will remain sticky well into the coming year. The Bureau of Economic Analysis’ delayed September PCE inflation report showed both core and headline readings that were largely in-line with Wall Street forecasts. Core inflation did slow for the first time in April, but remains a lot closer to 3% than to the Fed’s 2% target, and tariffs are likely to keep feeding into the economy as more timelier readings emerge.