Wholesale inflation cools more than expected in May
JPMorgan Asset Management chief market strategist Gabriela Santos analyzes the Federal Reserve's interest-rate decision making on 'The Claman Countdown.'
Inflation at the wholesale level moderated more than expected in May, the latest sign that price pressures within the U.S. economy are loosening their grip.
The Labor Department said Thursday that its producer price index, which measures inflation at the wholesale level before it reaches consumers, fell 0.2% in May from the previous month, the biggest drop since October. On an annual basis, prices remain up 2.2% – unchanged from last month and the highest level since April 2023.
Those figures are both lower than the 0.1% monthly increase and the 2.5% headline gain forecast by LSEG economists.
In another sign that suggests high inflation is easing, core prices – which exclude the more volatile measurements of food and energy – were flat for the month. That is lower than both the 0.3% estimate and the 0.5% gain recorded the previous month.
The figure was up 2.3% on a 12-month basis, slightly lower than expected.
«Thursday's weaker-than-expected PPI data is another sign of continued progress on inflation, and it keeps the prospect of a rate cut alive in 2024,» said Clark Bellin, president and chief investment officer at Nebraska-based Bellwether Wealth.
WHY ARE GROCERIES STILL SO EXPENSIVE?
High inflation has created severe financial pressures for most U.S. households, which are forced to pay more for basics like rent, groceries and gasoline. Price hikes are particularly devastating for lower-income Americans, because they tend to spend more of their already-stretched paycheck on necessities and therefore have less flexibility to save money.
A worker arranges produce at
Read more on foxbusiness.com
