Wholesale inflation jumps more than expected as 'extended and bumpy journey' continues to Fed's target

Published On Dec 12, 2024, 9:42 AM

Wholesale inflation, indicated by the Producer Price Index (PPI), increased by 3% for November year-over-year, higher than the expected 2.6%, signifying persistent inflation concerns. Core prices also rose by 3.4%, again above expectations. This indicates that while inflation is decreasing from higher levels, it remains stubbornly above the Federal Reserve's target, suggesting future interest rate adjustments might be less aggressive than previously assumed. The Fed's cautious approach may lead to reduced expectations for further interest rate cuts in 2025.

Read full article

Stock Forecasts

SHYView SHY chart on TradingView

Negative

With inflation remaining elevated, particularly in producer prices, this could weigh heavily on sectors sensitive to interest rates, such as real estate and consumer discretionary goods. Investors might consider defensive stocks or funds that perform well amidst inflation, as consumer spending shifts.

Related News

Fed officials were divided on whether to cut rates by half a point in September, minutes show

Oct 9, 2024, 2:00 PM

The Federal Reserve on Wednesday releases minutes from its Sept. 17-18 policy meeting.

TLT
SHY

Demand for bonds likely to rise in the year ahead: Kelsey Berro

J.P. Morgan Asset Management fixed income portfolio manager Kelsey Berro discusses whether the Fed accomplished its inflation goal on 'Making Money.'

BND
SHY