Producer prices fall, bolstering argument for Fed rate cut

Group 1 - The latest Producer Price Index (PPI) data indicates a slight decline, which contrasts with persistent price pressures above the Federal Reserve's target [3][7] - Core inflation, measured by the personal consumption expenditures price index excluding food and energy, increased to 2.9% in July, while the core consumer price index rose at a 3.1% annual rate [3][5] - The PPI unexpectedly decreased by 0.1% in August, with service costs falling by 0.2%, while the annual increase was 2.6%, surpassing the Fed's long-term inflation target of 2% [7] Group 2 - Traders in interest rate futures have raised the likelihood of a 0.75 percentage point cut in the benchmark interest rate by December, with a 73% probability noted [4] - Fed officials have shown concern regarding signs of weakness in the job market and are leaning towards loosening monetary policy despite inflation being above target [5] - Import duties are expected to raise prices by 1% to 1.5% temporarily, with the impact fading by the second half of 2026 [6]