US: Confidence and PCE in focus – TD Securities

TD Securities highlights PPI and consumer confidence as the key US data this week, with January PPI feeding into PCE forecasts. The bank expects a below-consensus rebound in February consumer confidence to 85.5, and sees core PCE moderating in January but ending 2026 with core and headline PCE at 2.9% and 2.7% respectively.

Confidence rebound and inflation profile

"The two key data releases will be PPI and consumer confidence. January PPI will be a key input into PCE inflation forecasts. We expect February consumer confidence to register a below-consensus rebound."

"We maintain our expectation for January core PCE to moderate to 0.19% m/m with headline lower at 0.12% (based off January CPI). This forecast will be updated after January PPI is released this Friday."

"However, after December PCE surprised us to the upside, we are now looking for 2.9% and 2.7% y/y for core and headline."

"Other data this week will be light, with the highlight being a likely rebound in consumer confidence. Jobless claims and various regional fed surveys will also be released."

"Consumer Confidence: We expect a below-consensus rebound in February consumer confidence to 85.5 after it declined sharply to 84.5 in January."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)