Overview
- The producer price index due Thursday, Sept. 10, and the consumer price index due Friday, Sept. 11, are the last major data points before the Federal Open Market Committee meets on Sept. 15–16.
- Fed Governor Christopher Waller has said those August readings will influence whether the Fed holds rates or raises the federal funds target by 25 basis points.
- Consensus forecasts expect both August PPI and CPI to rise about 0.4% month over month with core CPI near 2.3–2.4% year over year.
- Analysts point to a split inflation picture where falling goods prices are pulling core CPI down while services costs, especially shelter, remain stubborn and keep overall inflation elevated.
- Markets and polls are divided on policy with a majority of economists expecting a hold but a meaningful minority and prediction markets pricing a material chance of another rate hike; headline PCE through June stayed high at 3.7% and core PCE at 3.3%, which keeps pressure on policymakers.