On Friday, the U.S. will release inflation data based on the Personal Consumption Expenditures (PCE) index excluding food and energy – the Federal Reserve’s preferred measure. Markets expect core inflation to rise 0.2% in August, down from July’s 0.3% reading. Easing price pressures could give the Fed more flexibility in shaping monetary policy, especially in light of a weakening labor market.
Fed Chair Jerome Powell explained the Fed’s recent rate cut – its first this year – by pointing to slowing job growth, while stressing the central bank is closely monitoring inflation trends. Several Fed officials, including Powell himself, are scheduled to speak next week. Alongside inflation, investors will also watch data on consumer spending and household incomes, also due Friday, with forecasts pointing to a marked slowdown in real spending growth. Both indicators are key to assessing the U.S. economy’s growth trajectory.
Safe Havens Rally on Rate Cut Expectations
Amid expectations of further Fed cuts, investors have turned to safe-haven assets. Gold climbed 0.9% to a record $3,719.95 per ounce, surpassing last week’s high of $3,708. Silver rose even more strongly to $43.77 per ounce. On Friday, trading volume in options on the iShares Silver Trust ETF hit a record 1.2 million contracts on the NYSE Arca. Gold breaking above $3,708 and silver above $43 may signal further upside for precious metals.
Markets are currently pricing in nearly two more Fed rate cuts before year-end, with key signals to come from Friday’s PCE inflation data and Powell’s Tuesday remarks.
H-1B Visa Fee Sparks Backlash in Tech
Adding to market tensions, U.S. President Donald Trump announced a new $100,000 fee for H-1B visa applications. The surprise move – initially lacking clear details – triggered strong reactions from tech firms and foreign specialists working in the U.S. Although the White House later clarified the fee applies only to new applications, not renewals or current visa holders, the initial uncertainty led many companies to pause recruitment or explore relocation options.
The H-1B visa has long been the backbone of U.S. high-skilled immigration, particularly in technology. Such a steep fee – many times higher than existing application costs – could restrict access to the program, especially for smaller firms and startups. Over time, this may weaken the competitiveness of the U.S. tech sector globally. On the other hand, analysts suggest the move may serve as a bargaining chip in U.S.–India relations. In 2024, 71% of H-1B visa recipients were from India.
Author: Krzysztof Kamiński – OANDA TMS
Disclaimer: The information contained in this publication is for informational purposes only. It does not constitute financial advice or any other form of advice. It is general in nature and not directed at any specific recipient. Independent advice should be sought before using this information for any purpose.
Source: CEO.com.pl
