Producer prices in the United States rose moderately in December

US producer prices rose moderately in December, but that is unlikely to change views that the Fed will not cut interest rates again before the second half of this year amid labor market resilience.

the Producer price index The Labor Department’s Bureau of Labor Statistics said Tuesday that final demand rose 0.2% last month after an unrevised 0.4% increase in November. Economists polled by Reuters had expected the producer price index to rise by 0.3%.

In the 12 months to December, the producer price index accelerated by 3.3% after rising 3.0% in November. The year-over-year rise in the rate reflects lower prices last year, especially for energy products, which were taken out of the calculation.

Fed meeting minutes show policymakers see immigration and tariff shifts as creating uncertainty about inflation.

The report came on the heels of news last week that A Sharp rise in non-farm payrolls In December, the unemployment rate fell, leading economists to expect that the US central bank would keep interest rates unchanged until June.

The US economy added 256,000 jobs in December, far exceeding expectations

At least one wall Street Foundation, Bank of America Securities now believes the Fed’s easing cycle is over. Goldman Sachs now expects two cuts this year in June and December, revised down from three previously.

The central bank began its easing cycle in September and cut its benchmark overnight interest rate by 100 basis points to the current range of 4.50%-4.75%.

The last cut was in December when policymakers also expected two interest rate cuts this year instead of the four they expected in September.

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The interest rate was raised by 5.25 percentage points in 2022 and 2023 to curb inflation. Fears are rising over pledges President-elect Donald Trump Imposing or significantly increasing import tariffs and deporting millions of illegal immigrants could lead to increased inflation. This was evident in the sharp rise in consumer inflation expectations in January.