Inflation Surges as Trump Prepares New Tariffs

January inflation data exceeds expectations, complicating Federal Reserve rate decisions while markets await Trump's reciprocal tariff announcement.

The Producer Price Index (PPI) rose 0.4% in January, outpacing expectations of 0.3%, with annual wholesale inflation increasing to 3.5%.
Core wholesale inflation, excluding volatile food and energy prices, rose 3.6% year-over-year but showed a smaller-than-expected monthly gain of 0.1%.
President Trump plans to announce reciprocal tariffs targeting countries with levies on U.S. goods, following recent tariffs on steel and aluminum imports.
Economists suggest rising inflation and tariff policies could limit Federal Reserve rate cuts, with officials signaling a 'restrictive' stance for now.
Market indices, including the Dow and Nasdaq, posted modest gains as investors balanced inflation concerns with solid corporate earnings reports.