Wall Street surges along with rate cut odds

Trump just got another win against the Federal Reserve, after new data from the Bureau of Labor Statistics on Wednesday showed that wholesale prices fell by 0.1% in ￰0￱ unexpected drop gave markets a jolt and made an interest rate cut more ￰1￱ followed a revised 0.7% rise in July and was well below the 0.3% increase Wall Street ￰2￱ headline Producer Price Index (PPI) is now up 2.6% over the past ￰3￱ core PPI, which cuts out energy and food, also slipped 0.1%, even though economists had forecast another 0.3% ￰4￱ food, energy, and trade are all removed, the number shows a 0.3% monthly increase and a 2.8% year-over-year gain. That’s the kind of number that gives the Fed room to cut, especially after months of tough talk on ￰5￱ Street surges along with rate cut odds Stock futures jumped, and Treasury yields dipped after the data ￰6￱ reacted ￰7￱ to the CME FedWatch Tool, there’s now a 100% chance the Federal Open Market Committee will cut rates next ￰8￱ last interest rate cut happened in December, right after Trump won his reelection, and while most expect a quarter-point cut, the odds of a bigger half-point cut surged to 11.3% after the ￰9￱ Fed’s meeting is next week, and it’s not just a rate call—it’ll include a full update on how officials see the ￰10￱ the new data is turning the heat ￰11￱ costs, a key part of inflation that the Fed watches closely, fell 0.2%, led by a 1.7% drop in trade ￰12￱ margins for machinery and vehicles plunged 3.9%.

That matters. That’s pricing power fading in real time. Meanwhile, goods prices barely moved, rising just 0.1% ￰13￱ goods were up 0.3%. Food costs crept up 0.1%, while energy fell 0.4%.

It’s flat out there. “Net, net, the inflation shock that was not is rocketing markets higher,” said Chris Rupkey, economist at Fwdbonds, adding, “There is almost nothing to stop an interest rate cut from coming now.” Trump pressure builds as labor numbers disappoint The Fed has been dragging its feet all year, blaming Trump’s tariffs for possible inflation ￰14￱ the data’s saying something ￰15￱ prices, which are affected by tariffs, jumped 2.3% in ￰16￱ that was one of the few ￰17￱ management fees, a driver of July’s spike, rose again 2% in August, though down from 5.8% in July. Still, Trump has kept hammering the Fed. He’s pushed for lower rates, arguing that his tariffs aren’t inflationary and that the ￰18￱ cheaper borrowing to grow and manage its massive ￰19￱ Wednesday’s release, he posted on Truth Social, “Just out: No Inflation!!! ‘Too Late’ must lower the RATE, BIG, right ￰20￱ is a total disaster, who doesn’t have a clue!!!

President DJT.” Meanwhile, the Fed’s labor data headache is growing. A separate BLS report from Tuesday revealed the economy added 1 million fewer jobs than earlier reported in the 12 months leading up to March 2025. That’s a ￰21￱ Fed’s been calling the labor market “solid,” but those numbers don’t back that ￰22￱ though inflation is still above the Fed’s 2% target, many at the central bank believe it’ll keep falling as housing and wage pressures ￰23￱ with Trump on the offensive, markets turning, and job numbers revised downward, the Fed’s not looking like it’s in control ￰24￱ up to $30,050 in trading rewards when you join Bybit today