"Wednesday's producer price data surprised to the downside, falling 0.1% in August against expectations of a 0.3% increase. The decline was driven by lower margins in wholesale trade, offsetting modest gains in goods prices. The release reinforced the view that price pressures may be transitory, echoing recent comments from Fed officials and adding to the case for further policy easing."
"Treasury yields remained steady, with the 10-year note holding above 4%, reflecting investor caution ahead of the CPI release. Core inflation is expected to remain at 0.3% month-on-month, while headline CPI is seen rising slightly to 0.3%. Softer numbers could drag yields lower and weigh further on the dollar, while firmer readings might provide temporary support without overturning expectations of near-term cuts."
The US dollar remained near recent lows while investors awaited consumer price data that could influence the Federal Reserve's next meeting. The greenback has been under pressure since last week's weak jobs report. Wednesday's producer price index fell 0.1% in August versus an expected 0.3% rise, driven by lower wholesale trade margins that offset modest goods price gains. That decline reinforced views that price pressures may be transitory and strengthened the case for further policy easing. Treasury yields stayed steady with the 10-year above 4%, and political uncertainty is weighing on confidence in US assets.
Read at London Business News | Londonlovesbusiness.com
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