At 11 PM tonight, a key data point will be released—the US Core PCE, with the market generally expecting it to remain at 2.9%. Maybe you think this is just another economic indicator? But it directly influences the Fed’s next move, which in turn affects the assets you hold.

Why is this data so important? Core PCE is the Fed’s most closely watched inflation indicator. Unlike the more familiar CPI, PCE covers a broader range—not only calculating the goods you directly consume but also including employer-paid health insurance costs. It also periodically adjusts its weightings, better reflecting consumers’ behavior of “switching to cheaper alternatives when prices rise.” Most importantly, Core PCE excludes the highly volatile energy and food prices, focusing on more persistent components like housing and healthcare—these are the true core for judging whether inflation has really cooled down.

There are undercurrents behind the 2.9% expectation this time. In September, gasoline prices jumped 3.5% month-over-month, but rents and financial services costs fell, offsetting each other and resulting in this “neither high nor low” figure. However, with the Fed’s December meeting approaching, hawks argue that 2.9% is still well above the 2% target and advocate maintaining a tightening stance; doves point out that the unemployment rate has risen to 4.4%, and further rate hikes could drag down the economy.

Once this data is released, the market will react immediately:

At 2.9% as expected? Tech stocks and risk assets may see a slight rebound, the dollar may fluctuate moderately, and gold may trade sideways.
A surprise rise to 3%? The dollar will likely strengthen, while gold and growth stocks come under pressure and decline.
A drop to 2.8%? The market will take it as a signal for rate cuts, and stocks and precious metals may rally.

It’s worth noting that this data was originally scheduled for earlier release but was delayed due to a government budget impasse. When even the release of economic data can be disrupted by political factors, its reference value is somewhat diminished.

Do you think tonight’s data will land smoothly or trigger significant market volatility?