July Inflation Numbers Surprise to the Downside, Strengthening Case for Rate Cuts
Wholesale inflation numbers for July showed a softer reading across nearly every major line, according to data from the CME in Chicago. CNBC markets commentator Rick Santelli reported that the Producer Price Index (PPI) came in lower than expected, with headline PPI flat month over month versus a 0.2% increase anticipated.
The year-over-year figure showed even sharper deceleration, with final demand PPI dropping from 5.5% to 4.7%. Core PPI, which strips out volatile food and energy components, also came in below expectations at 2/10 less than expected.
Santelli noted that the numbers were 'mostly better than expected sequentially' and that inflation has been running hot through the spring. The report was seen as a positive development ahead of the Federal Reserve's fall meetings.