Symbolic imageUS producer prices surge, feeding bets on Fed rate hike
US producer prices rose 1.3% in September, far above forecasts, driven by energy costs. Retail sales also beat expectations.
The Department of Labor said the producer price index for final demand was up 6.3% from a year earlier, the largest 12-month rise since 6.4% in December 2022, according to Breitbart. Economists had forecast 0.5% for the month and 5.4% for the year. Goods prices rose 2.6%, and gasoline, up 20.3%, accounted for half of that. Prices excluding food and energy rose 0.7% on the month and 5% on the year.
Rate-hike bets and housing
Reuters reports that UBS now forecasts a Fed rate hike in March after the inflation surprise. Reuters and Bloomberg say September retail sales beat expectations on higher gasoline prices. The New York Times reports the average 30-year mortgage rate at 7.4%, the highest since 2023.
Voters feel the prices
A Harris poll for the Guardian, less than three weeks before the midterms, found two-thirds name gas and grocery prices as their top issue. 61% wrongly believe the US is already in recession. Inflation reached 3.7% in September, the Guardian reports.