Tonight, all traders have their eyes locked on a single number—the September PCE Price Index.

This isn’t just any economic data. It’s the inflation gauge the Federal Reserve watches most closely, and this time, due to the delayed release caused by the government shutdown, the market’s appetite has only grown stronger. Simply put, this is the first official inflation report since late September, and it’s also the last card to be played before next week’s Fed meeting.

Right now, the Fed is walking a tightrope: with one hand, it needs to keep inflation in check, and with the other, it has to protect the job market from stumbling. This PCE report? It’s the straw that could tip the balance.

**Scenario One: The Data Behaves**
If the core PCE annual rate stays steady around 2.9% as expected—or better yet, drops a bit—then another rate cut next week is basically a done deal. How will the market react? Risk appetite will soar, stocks will rally, the “soft landing” narrative will continue, and everyone will be happy.

**Scenario Two: The Data Surges Unexpectedly**
But if core PCE doesn’t follow the script and jumps above 3%? The game changes instantly. The Fed’s previous claims that “inflation is cooling” would get slapped in the face. A December rate cut? The market will immediately lose faith. Even worse, the pessimistic expectation that “high rates are here to stay” will return with a vengeance. At that point, stocks, bonds, forex, and even crypto—all would take a hit, with asset prices reshuffled and no one escaping unscathed.

To put it simply, tonight’s data is a true litmus test.

Mild? It’s a green light for the rate-cut cycle and a continued party for risk assets.
Off the charts? It’s a cold shower for the market, and everyone’s bets will need to be recalculated.

This isn’t just about a few numbers—it’s a life-or-death battle between market sentiment and policy expectations.

At 11:00 p.m. Beijing time tonight, the core PCE annual rate will be released; last time, it was 2.9%.
Once the hammer falls, the trend for the next week—or longer—will be set. Hold your breath and watch to see how this data, which could decide everything, plays out.