US STOCKS-Wall Street set to open higher after inflation data calms rate-cut jitters

By Niket Nishant and Sukriti Gupta

Sept 26 (Reuters) - Wall Street's main indexes were set to open higher on Friday, after the latest inflation data met expectations, easing concerns that persistent price pressures could delay interest rate cuts by the Federal Reserve.

A Commerce Department report showed the Personal Consumption Expenditures index rose 2.7% in August on an annual basis, compared with an estimated 2.7% rise, according to economists polled by Reuters.

Excluding volatile food and energy components, core PCE increased 2.9%, also in line with expectations.

The data offers fresh clarity after a tense week during which investors weighed mixed signals from the central bank's policymakers, who remain split between advocating for aggressive rate cuts and urging a more cautious approach.

Still, some analysts noted that inflation figures do not capture the full picture and the impact of new tariffs has yet to filter through.

"Significantly more inflation pass-through is still to come. Firms aggressively accumulated inventories during the first half of the year, and this has given them scope to delay price increases. But that process is now playing through," Citigroup's global chief economist Nathan Sheets said.

Federal Reserve Bank of Richmond President Thomas Barkin, in an interview with Bloomberg Television, also said he had very low confidence in inflation forecasts right now as tariffs continue to impact the economy, and businesses and households wrestle over who will bear the cost of new import taxes.

U.S. President Donald Trump on Thursday unveiled fresh import tariffs, including 100% duties on branded pharmaceutical products, 25% levies on heavy-duty trucks, 50% on imported kitchen cabinets and bathroom vanities and 30% on upholstered furniture.

The move could reignite fears of a renewed trade war, particularly with key partners in Asia and Europe, and complicate the inflation outlook.

At 08:55 a.m. ET, Dow E-minis YMcv1 were up 203 points, or 0.44%, S&P 500 E-minis EScv1 were up 19.75 points, or 0.3%, and Nasdaq 100 E-minis NQcv1 were up 56.75 points, or 0.23%.

Shares of Eli Lilly LLY.N rose 1.5% and Viking Therapeutics VKTX.O added 0.9% in premarket trading. Truck maker Paccar PCAR.O, which manufactures most of its trucks for the U.S. market domestically, gained 5.8%.

Some furniture companies fell, with Wayfair W.N down 2.7%.

In corporate news, Intel INTC.O jumped 3.9% after a Wall Street Journal report said the chipmaker had approached Taiwan Semiconductor Manufacturing Co 2330.TW about investments in manufacturing or partnerships.

GlobalFoundries GFS.O jumped 8.2% after a report said the U.S. was planning a chip production rule to curb reliance on overseas supply.

Investors will also tune in to remarks from Fed Vice Chair for Supervision Michelle Bowman later in the day for additional signals on how policymakers are interpreting the latest inflation trends.

Equities remain richly valued by historical standards, leaving little room for disappointment on macro data.

With the U.S. earnings season set to kick off in a few weeks, investors are also watching for signs that elevated valuations are backed by fundamentals, making upcoming corporate results a key test for the rally's durability.