PRIMER - US PCE inflation data is due at 13:30BST/08:30EDT

The recurring wedge episodes are worth bearing in mind: portfolio management fees, healthcare components sourced from PPI, and the different weighting of shelter mean PCE can deviate from CPI even when the underlying impulse is identical, and in past cycles these divergence prints have whipsawed the front end before the mix was digested. The distinction that matters for positioning is between a print that shifts the distribution for the imminent meeting and one that shifts the terminal path: a soft core monthly tends to lift odds of a hold at the near date first, with the curve's level only moving if the run-rate is read as durable. A primer of this kind, flagging consensus, component mechanics and the linkage to the upcoming FOMC, signals that desk focus is on the reaction function rather than the level itself. The follow-ons are the calendar items already named: subsequent labour data and the chair's Jackson Hole appearance, which in past cycles has been used to front-run or refine the reaction function ahead of meetings where the decision was finely balanced. Where pricing sits close to a coin flip on the next meeting, the two-sided risk around a confirming print is usually modest and the repricing concentrates on any miss in either direction.