WS #15148
The US Core PCE Price Index for August came in at 0.2% MoM, below the 0.3% forecast, providing the first concrete data point that inflation is cooling. This has led traders to pare back expectations for a Federal Reserve rate hike in October, shifting the macro narrative toward a more dovish stance. The data supports equity valuations by reducing the cost of capital pressure. The AI capital expenditure cycle is accelerating, with Goldman Sachs forecasting $1.2 trillion in Big Tech spending next year. Private market activity is also surging, evidenced by ElevenLabs doubling its valuation to $22 billion. This sustained investment demand supports the broader tech thesis, particularly for infrastructure and specialized AI application providers.
US Inflation & Fed Policy
The US Core PCE Price Index for August came in at 0.2% MoM, below the 0.3% forecast, providing the first concrete data point that inflation is cooling. This has led traders to pare back expectations for a Federal Reserve rate hike in October, shifting the macro narrative toward a more dovish stance. The data supports equity valuations by reducing the cost of capital pressure.
The AI capital expenditure cycle is accelerating, with Goldman Sachs forecasting $1.2 trillion in Big Tech spending next year. Private market activity is also surging, evidenced by ElevenLabs doubling its valuation to $22 billion. This sustained investment demand supports the broader tech thesis, particularly for infrastructure and specialized AI application providers.