Wholesale Inflation Ticks Down While Consumer Inflation Ticks Up

Wholesale prices dropped in August, but inflation rose just before the potential interest rate cuts from the Federal Reserve next week.

The Details: The Producer Price Index (PPI) dropped 0.1% in August, and July’s figure was revised down, but the Consumer Price Index (CPI) rose 0.4% compared with July. Compared to a year ago, the PPI rose by 2.6% and the CPI was up by 2.9%.

For Context: The Federal Reserve is expected to weigh potential interest rate cuts next week, with Federal Reserve Chair Jerome Powell citing the job market and inflation outlook for a possible rate cut. The price increases, fueling the CPI increase, could be a sign that tariffs are pushing prices higher, but the PPI numbers are also showing that tariffs are not having much of an effect on wholesale prices.

How The Media Covered It: Fox Business (Lean Right bias) noted that tariffs could be affecting consumer prices, saying the “inflation remained stubbornly high.” Newsweek (Center) focused on a Cygnal poll showing Americans are reportedly blaming Republicans more than Democrats for the rising inflation, calling the inflation numbers “bad news” for Republicans. ABC News (Lean Left) highlighted President Donald Trump’s “intensified” tariffs, citing Powell’s warning of a “tariff-induced price hike.” CNN Business (Lean Left), covering the drop in wholesale inflation, said businesses have absorbed the cost of tariffs “for now,” citing warnings from some economists that the “better-than-expected reading could be a sign of a slowing economy.” Breitbart (Right) said the drop in producer prices is “undercutting tarrifflation fears,” highlighting that companies are not passing the higher costs associated with tariffs onto consumers.     

Written by the AllSides staff (of humans). Learn more. Support our mission. Suggest an improvement to this summary.