Core wholesale prices rise unexpectedly, further dimming hopes for big rate cut

Core wholesale prices excluding volatile food and energy prices rose higher than expected, further dimming hopes for a 50-basis point interest rate cut next week.

The US government’s Producer Price Index — which tracks the cost of goods and services for domestic producers — rose 0.2% last month, in line with economists’ expectations, according to a poll by The Wall Street Journal.

However, wholesale prices excluding volatile food and energy — a metric closely watched by economists to gauge underlying inflation trends — increased 0.3% in August from a month earlier, slightly above expectations of 0.2%.