US data come in hotter than expected: July PCE at 3.7%, core at 3.3%; Q2 GDP cools to 1.5%

Fresh US macro releases point to stickier inflation than markets had penciled in. July PCE inflation rose 3.7% year over year versus a 3.6% consensus forecast, while core PCE printed 3.3%. At the same time, Q2 GDP growth slowed to 1.5%. With inflation still running close to double the Federal Reserve's 2.0% target as growth cools, stagflation concerns are resurfacing.