Wholesale Inflation Spikes in July

The U.S. economy has experienced a significant jolt with wholesale prices surging in July. The Producer Price Index (PPI) climbed by 0.9% for the month, marking the fastest increase since May 2022. This jump was driven largely by rising costs for both food and services, signaling that inflationary pressures remain persistent. The core PPI, which excludes volatile food and energy prices, also saw its steepest monthly rise in over three and a half years. This data has caused investors to reconsider the likelihood of a major interest rate cut by the Federal Reserve, as the central bank faces a delicate balancing act of controlling inflation without slowing the economy too abruptly.