<h1>Inflation expectations drive markets as investors await the US personal consumption expenditures index and adjust policy bets.</h1> Markets fell broadly as investors awaited the US personal consumption expenditures index for July and assessed mixed regional data. Germany's unemployment remained elevated after seasonal adjustment, Japan's factory output weakened and Tokyo inflation slowed, while China's chip sector showed volatile gains amid policy support. US indicators presented a mixed picture-softening hiring trends alongside quarterly GDP growth-shaping expectations about the timing and path of monetary policy and driving modest moves in equities, oil and currencies.