In July 2024, a principal indicator of U.S. wholesale inflation climbed less than anticipated, potentially paving the way for the Federal Reserve to begin reducing interest rates.
The Producer Price Index (PPI), which is a gauge of wholesale inflation, saw a modest increase of 0.1% for the month of July, falling short of the 0.2% prediction. Excluding food and energy, the PPI remained unchanged.
Year-on-year, the headline U.S. PPI ascended by 2.2%, marking a significant decline from June’s 2.7% figure.
Should the Federal Reserve not proceed now with a rate cut VERY soon, it is probable that a ‘frenzy’ of ‘catch-up’ rate cuts will ensue to counteract a struggling economy.