US PPI Surprise Rise Boosts Core PCE Expectations, Reviving Fed Rate Hike Pressure

English summary

The US Producer Price Index (PPI) rose 1.3% month-over-month, significantly exceeding expectations, prompting Wall Street to raise forecasts for September's core Personal Consumption Expenditures (PCE) inflation. Data indicates inflation pressure is transmitting from the production side to consumption, leading markets to reassess the likelihood of Federal Reserve rate hikes at October and December meetings, with fed funds futures showing a 91% probability of at least one hike by December.