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US Producer Prices Decline, Signaling Easing Inflation Pressures
10 Sep
Summary
- Producer inflation in the US slowed to 2.6% in August
- Core PPI missed analysts' estimates, rising 2.8% annually
- USD Index fell as data fueled bets on upcoming Fed rate cut
According to data released on September 10th, 2025, producer inflation in the United States has slowed down significantly. The Producer Price Index (PPI), which measures wholesale price changes, declined to 2.6% on an annual basis in August, down from 3.3% in July.
This reading came in below the market expectation of 3.3%. On a monthly basis, the PPI declined by 0.1% following a 0.7% increase (revised from 0.9%) recorded in July.
The core PPI, which excludes volatile food and energy prices, also missed analysts' estimates, rising 2.8% year-over-year after a 3.7% increase in July. This suggests that underlying inflationary pressures are easing in the US economy.
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The weaker-than-expected inflation data has put renewed bearish pressure on the US dollar, with the US Dollar Index declining 0.1% on the day to 97.65. This has fueled bets on the Federal Reserve cutting interest rates when it meets later this month, as policymakers grapple with the challenges of balancing price pressures and a cooling labor market.
