Ice-cold inflation readings have opened the door for potential Fed rate cuts, while the market continues to push all-time highs.

The Producer Price Index (PPI), which measures the cost of inputs, had been running hot earlier this year. Before August, readings reflected tariff pressures and concerns about producers passing inflation onto consumers. Regardless, the most recent report flipped the trend, coming in at -0.1%. Core PPI also cooled, falling from 3.4% to 2.8% in August.

On the consumer side, the Consumer Price Index (CPI) remains less impressive, with core inflation still above 3% and headline inflation around 2.8%. Still, these levels are enough to keep hopes alive for easing monetary policy.

All eyes now turn to the Fed’s meeting on September 16th and 17th, which should provide a clearer picture of what’s next. We’ll keep you updated as developments unfold.