All eyes on US growth data

While global markets are on a mixed note due to uncertainties surrounding the fight against inflation in the US and the financial results of US chip giant Nvidia, all eyes are on today’s US growth and personal consumption expenditures data. The effects of the US protectionist trade policy on the fight against inflation in the country are one of the main economic agenda items, the signals from the core personal consumption expenditures price index, which the US Federal Reserve (Fed) considers as an inflation indicator, whose quarterly data will be released today and monthly data tomorrow, are expected to reduce uncertainties regarding the Fed’s interest rate cut process. In addition, growth data for the second quarter is expected to increase by 3.1 percent compared to the same quarter of the previous year, and this data is expected to be effective in clarifying global financial projections. Meanwhile, the ongoing government’s critical stance towards the Fed is a focus of investors. U.S. Treasury Secretary Scott Bessent stated that they have 11 strong candidates for the Fed presidency, noting that they will begin interviews after Labor Day and present Trump with the final candidate list. Analysts noted that the government is acting prematurely for a replacement scheduled for May next year, adding that if a potential candidate emerges, the "shadow Fed" dilemma will have an impact on risk appetite in the markets. Money market sentiment is pricing in an 87 percent chance that the Fed will cut the rate by 25 basis points in September, with a total cut of 50 basis points expected by year-end.