Morgan Stanley: The latest PCE report fails to lower the Federal Reserve's interest rate hike expectations

The core Personal Consumption Expenditures (PCE) price index for July rose by 0.2% month-on-month and 3.3% year-on-year, both in line with expectations.

Ellen Zentner, Chief Economic Strategist at Morgan Stanley Wealth Management, stated: "The mild upside surprise in today's inflation data, along with relatively strong economic performance, is not something that investors or the Federal Reserve would welcome. However, this set of data is not sufficient to shift the decision-making balance for the September Federal Open Market Committee (FOMC) meeting."