Producer Prices Match Expectations in September, but Fed Debate Intensifies 

The Producer Price Index (PPI) for final demand rose 0.3% in September on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported Thursday. The print matched expectations, following a 0.1% decline in August and a 0.8% increase in July. Over the past 12 months, producer prices climbed 2.7%. 

Core PPI—which excludes volatile food, energy, and trade services—edged up 0.1% in September after a 0.3% gain in August. On an annual basis, the core index rose 2.9%. 

The Federal Reserve remains sharply divided over the path of monetary policy as inflation proves sticky and signs of labor-market softening intensify. Upcoming data could provide crucial clarity, helping policymakers determine whether to pause their rate-cut cycle or press ahead with additional easing at the December meeting. 

That uncertainty is clearly reflected in market pricing. Expectations for a quarter-point cut have swung dramatically in recent weeks. Interest-rate futures were pricing in an 83% probability of a cut, up from roughly 42% a week earlier but down from nearly 92% in late October, according to the CME FedWatch tool.