BREAKING: Inflation plunged to a 4.6% annual rate in February, as measured by the producer price index.
The decline in the wholesale price index reported Wednesday morning by the Bureau of Economic Analysis shows that inflationary pressures are abating in the face of the Federal Reserve’s campaign to slow economywide spending by hiking interest rates.
Nevertheless, inflation is still running much hotter than the central bank’s target and dinging household purchasing power.SVB COLLAPSE: WAS IT A BAILOUT?The high inflation of the past two years has battered household purchasing power and undercut support for President Joe Biden's economic agenda. Wednesday’s PPI report comes a day after the consumer price index, which is even more closely watched, was released.
Annual inflation fell to 6% after it had been running at 6.4% the month before. The annual inflation has been trending down since it hit a whopping 9.1% in June. Still, though, recent month-to-month price gains have been high, suggesting that the Fed's efforts still have not succeeded in taming inflation.
The Fed will meet next week to decide whether to raise interest rates, although there are mixed opinions on if the central bank should hike rates at all following SVB’s collapse and, if so, by how much.
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