Producer Prices Surge, Inflation Expectations Rise

0:00On March 18, US producer prices jumped more than expected in February, rising 0.7% for final demand. That beat economist forecast of just 0.3% and followed a 0.5% gain in January, services drove most of the increase, pushing the year-over-year figure to 3.4%, up from 2.9% the month before. The war in the Middle East has spiked oil prices over 40% since late February, adding pressure that economists expect to hit March reports for both producer and consumer prices. The Federal Reserve wrapped up its two-day meeting today, holding interest rates steady while releasing new projections that likely show higher. Inflation estimates, markets now bet on just one rate cut this year. Core personal consumption measures remain sticky, with estimates at 0.4% monthly for the third straight month and 3.1%. Percent yearly, well above the Fed's 2% goal. PCE data comes next month.