Core PCE steady at 0.3% m/m in July; inflation cooling while spending remains firm

U.S. inflation held a steady course in July as the Core PCE Price Index rose 0.3% month-on-month (2.9% YoY) and the headline PCE increased 0.2% m/m (2.6% YoY). At the same time, household income and outlays edged higher: personal income rose 0.4% m/m and personal spending increased 0.5%, while real personal consumption grew 0.3%. The pattern — sticky but decelerating core inflation alongside resilient consumer demand — suggests disinflation is progressing without a sharp demand collapse. Policymakers will likely view the mix as a reason to stay data-dependent: price pressures are easing, yet solid spending keeps the door open to a cautious policy stance.