Reported 7 months ago
The US Department of Labor unexpectedly announced on June 13th at 4:10 pm that the Producer Price Index (PPI) for May decreased by 0.2%, marking the largest decrease in nearly seven months, providing new evidence of easing inflationary pressures in the US. Additionally, the job market continues to cool as initial jobless claims in the US surged to 242,000 last week, marking the highest level in ten months. Following the release of these data, expectations for the Federal Reserve to begin cutting interest rates in September have risen again, causing the US 2-year Treasury yield, sensitive to Fed rate trends, to drop to 4.66%, the lowest level since April 5th. The Labor Department attributed the decline in May PPI to energy and service costs, showcasing a decrease in inflation signs observed earlier in the year. Core PPI remained flat compared to the previous month, below market expectations, with the year-over-year PPI increase also lower than anticipated. This data reinforces the notion that the once persistent inflationary pressures are now weakening and on a downward trajectory.
Source: YAHOO