The U.S. Commerce Department is scheduled to release July figures for the personal consumption expenditures price index at 8:30 a.m. Eastern time on Friday. The PCE gauge, the Federal Reserve’s preferred measure of inflation, is expected to show headline prices up 2.6% from a year earlier, with the core measure excluding food and energy seen at 2.9%, according to economists’ consensus estimates. Investors view the report as a key indicator of whether inflation is continuing to drift toward the Fed’s 2% target following the 145% tariff on Chinese imports that took effect in April. Evidence of tariff-related price pressures could complicate the policy outlook, though markets have largely priced in a 25-basis-point rate cut at the Fed’s September meeting. Fed Governor Christopher Waller this week reiterated his preference to begin lowering borrowing costs next month and signaled that additional easing may follow. A softer-than-expected PCE reading would likely reinforce those expectations, while a surprise acceleration could prompt investors to scale back wagers on a near-term cut.