Ryan Payne, president of Payne Capital Management, will be taking part in the market and joining “Varney & Co.”
In January, US producer prices rose steadily, providing more evidence, and inflation rates increased again, strengthening financial market views that the Federal Reserve will not cut interest rates by the second half of the year .
The final demand producer price index rose 0.4% last month after a 0.5% increase, which rose 0.5% in December, the Labor Bureau's Bureau of Labor Statistics (BLS) said Thursday. Economists voted by Reuters predicted that PPI would rise by 0.3%. In the 12 months from January to January, PPI rose 3.5% after a 3.3% increase in December.
The report follows Wednesday's news, and expects consumer prices to accelerate the most in nearly 1-1/2 years in January, with the US Central Bank returning to cut rates in June. Financial markets are hoping to cut rates in September, but some economists believe windows for further policy easing have been closed, citing strong domestic demand and stable labor markets .
Inflation rose 3% in January, hotter than expected
“We're nearby, but we're not inflation,” Federal Reserve Chairman Jerome Powell told lawmakers Wednesday. “For now, I would like to limit policy,” he added.
The Fed has left a benchmark without changing overnight interest rates in the 4.25%-4.50% range in January, cutting 100 basis points since the start of the policy easing cycle in September. Policy rates increased by 5.25 percentage points in 2022 and 2023 to tame inflation.
Trump wants lower interest rates to go “hold hands” at tariffs: “Rock and roll, America”
President Donald Trump's fiscal, trade and immigration policies are seen as incitement to inflation. The 25% tariff on goods from Canada and Mexico was suspended until March. However, this month there was an additional 10% charge for Chinese products.
Click here to get your Fox business on the go
With the January PPI report, BLS updated its weight to reflect price movements in 2024, and seasonal adjustment coefficients are the model the government uses to resolve seasonal variations from data.
