Today, along with January’s wholesale inventory data, we’ll see the second release of 4Q GDP in the US, which includes the personal consumption and PCE components. Expectations are for confirmation of strong 3.3% quarter-on-quarter annualised growth as per the advanced release. Personal consumption may be revised mildly lower and core PCE should be confirmed at 2.0% QoQ. 

Thursday’s PCE numbers for January are much more relevant for markets, and consensus is now aligned for a 0.4% month-on-month core print – even though the distribution of economists’ expectations is skewed to the downside.

We remain of the view that evidence of resilient inflation in the Fed’s preferred measure of inflation will offer more support to the Dollar into the end of the week.