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Update Economic USA Inflation PPI
After a sizable increase in producer prices last month, prices moderated with a slight drop reaching 2.4% annualized. This is a welcome slowdown as recent increases were starting to indicate a potential long term increase that could lead to inflation at the consumer level. With a spread of 0.5% between the CPI and PPI and with several months of trending increases, the Fed may decide to raise bank rates today in an effort to return to “normal” interest rates. Normal bank interest rates at the Fed are considered to be 3.0%.