Prices for US producers just shot up at the fastest pace in more than three years — and tariffs are the main culprit.
The producer price index (PPI), which tracks what American businesses charge for their goods, spiked 0.9% from June to July.
That’s a huge jump compared to last month’s flat reading and way above the 0.2% analysts expected.
Translation? Higher wholesale costs today could mean higher prices at the checkout counter tomorrow.
The surge comes as President Trump’s tariffs — taxes on imports — have driven up costs for companies.
He argues the levies will fill government coffers and give US manufacturers an edge.
An Alarming Situation?
But economists warn the reality may be less patriotic and more pricey.
“Expanding production here will be costly and slow,” experts caution, “and the bigger impact will hit businesses and consumers.”
The spike puts the Federal Reserve in a bind. Cutting interest rates, as Trump demands, could spur growth but also risk fueling inflation.
“It’s a dilemma,” says Matthew Martin of Oxford Economics, who predicts prices will climb even higher in the months ahead.
So, will the Fed hold the line or cave to political pressure? Either way, your wallet might be caught in the crossfire.
