This data may prove that US inflation may indeed be falling back towards the Fed's 2% target.
The U.S. Producers** Index (PPI) slowed in November as energy costs fellThis may be a further indication that inflationary pressures are weakening.
According to the U.S. Bureau of Labor Statistics, the core PPI monthly rate was unchanged from the previous monthThe annual rate is 24% fell to 2%, the lowest level since January 2021.
The annual rate of PPI in the United States recorded 09%, the lowest since June this yearThe monthly rate was 0%, lower than the market expectation of an increase of 0.1%。
Inflationary pressures have generally cooled in recent months. CPI data released on Tuesday showed that annual inflation has fallen, although it has picked up as the cost of housing and other services rises.
All in all,The data helps reinforce the view that inflation is coming back down towards the Fed's 2% target.
However, investors' expectations for the timing of the Fed's first rate cut were postponed from March to May as the November CPI data cooled less than expected.
Part of the reason economists are paying close attention to the PPI report is:Several categories, including certain health care programs and portfolio management, are used to calculate the Fed's preferred measure of inflation, the PCE price index.
Most of these indicators were weak in November, with no change in physician care services and nursing home care**. Hospital outpatient services, portfolio management and air passenger services** all declined.
At 3 o'clock Beijing time on Thursday, the Federal Reserve will announce its December interest rate decision, and the market expects it to keep its benchmark interest rate unchanged. Kurt Rankin, economist at PNC Financial Services Group, said:
"Some inflationary pressures persist, which is why the Fed must be particularly cautious and not ease policy prematurely. The Fed will not cut interest rates until the drivers of inflation are truly under control. ”