US February PPI Data Exceeds Expectations, Fed May Keep Rates Unchanged Tonight

Odaily News: The year-over-year increase in the US February Producer Price Index (PPI) exceeded expectations, and with the Middle East conflict driving up oil prices and ongoing import pass-through, it may accelerate further in the future. The US Bureau of Labor Statistics reported on Wednesday that, driven by the services sector, the February PPI surged 0.7% month-over-month, with the January increase revised to 0.5%. The war between the US-Israel and Iran, which began in late February, has pushed oil prices up by over 40%. Economists anticipate that the inflationary impact of the war will be reflected in the consumer and producer price reports for March, to be released next month. The Federal Reserve is expected to keep interest rates unchanged later today. Fed officials will submit new economic projections, and economists expect inflation forecasts to be revised upward; financial markets anticipate only one rate cut by the Fed this year. (Jin10)