Inflation data in July has economists on the brink of the abyss

The markets ended the week Unpredictable By printing wholesale more hot and signs of consumer prices, some economists warn that the main story is more important than investors seem to believe.

Product Prices Index (PPI) for July He rose to the highest level for three yearsWith enlarged services, he plays a major role in gains. A similar trend appeared in the most recent Consumer price index (CPI) Earlier this week, as prices in services such as dental care and airlines prices were a sudden reflection of the previous softening, which has been compensated for high -goods from customs tariffs.

New data now places the federal reserve, Which targets inflation 2 %In a risky position as the tensions between its double mandate for price stability and the maximum employment begin on the surface.

Huge enormous reviews In July, the job report last week feared that the labor market is very quickly, which enhances the issue of price discounts. But the hotble -awaited inflation data can indicate the need for more restrictions.

From Friday noon, the markets continued to pricing them at about 85 % of the possibility that the central bank will reduce prices in September, According to the latest CME Fedwatch tool. Federal Reserve Chairman Jerome Powell Jackson Hall next week can give hints on The next policy moves in the federal reserve.

Some economists argue that the Federal Reserve should stop cuts in prices – or even consider lifting rates.

“These are large -scale inflationary pressures,” Lahoo Finance, Lauren Baker, told Yahoo Finance in the heated PPI Print. “I see more reasons for high prices in order not to allow inflation to stay away from us.”

Saidel-Baker noted that these pressures were built for years and not only as a result of definitions. She pointed to the high wages and high energy costs, as the main engines now feed on data. She also stressed that the full impact of drivers will take a long time.

“Inflation is the danger on our doorstep, much more than the labor market,” Baker said. “Federal reserve officials know this.”

Read more: How does the Federal Reserve Price decision affect your bank accounts, loans, credit cards and investments

Chairman of the Federal Reserve at Chicago Austan Golsby Wednesday The high prices of services, similar to what was seen in the consumer price index report this week, will be worrying

“The services are not related to definitions,” he said. “Everyone hopes this is just an edge. There is noise in the data. If you start getting several months as the components indicate that the effect of customs tariffs does not remain in its course, it will be a more concern.”