The Producer Price Index, which measures final demand goods and services prices, jumped 0.9% in July – its biggest monthly gain since June 2022, the Bureau of Labor Statistics said Thursday.

That came in far above expectations for a 0.2% rise.

Container ships piled high with cargo at the port in Qingdao in China’s eastern Shandong province. AFP via Getty Images

Over the past 12 months, the PPI increased 3.3% in July, coming in well above the Federal Reserve’s 2% goal – just after a tame 2.7% consumer inflation reading earlier this week had seemingly teed up a rate cut in September.

“Given how benign the CPI numbers were on Tuesday, this is a most unwelcome surprise to the upside and is likely to unwind some of the optimism of a ‘guaranteed’ rate cut next month,” Chris Zaccarelli, chief investment officer for Northlight Asset Management, said in a note Thursday.

“The large spike in the Producer Price Index this morning shows inflation is coursing through the economy, even if it hasn’t been felt by consumers yet.”

Markets had priced in near-certain odds that the Fed would slash interest rates by a quarter point during its September meeting.

Those odds dipped slightly on Thursday following the PPI report’s release, according to CME FedWatch, which tracks 30-day Fed Funds futures prices.

The Dow Jones Industrial Average slipped 129 points, or 0.3%, while the S&P 500 and Nasdaq fell 0.2% and less than 0.1%.

President Trump speaks at an event at the Kennedy Center on Wednesday. Getty Images

Core PPI – which excludes volatile food and energy prices – rose 0.9%, above expectations of a 0.3% increase. 

Excluding food, energy and trade services, the index rose 0.6% for its largest gain since March 2022.

Services inflation largely drove the reading, rising 1.1% in July.

Trade services margins rose 2% in July as President Trump’s trade war raged on.

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About 30% of the increase in services came from a 3.8% jump in machinery and equipment wholesaling.

Portfolio management fees increased 5.8% and airline passenger services prices ticked up 1%.

“The fact that PPI was stronger-than-expected and CPI has been relatively soft suggests that businesses are eating much of the tariff costs instead of passing them onto the consumer,” Clark Geranen, chief market strategist at CalBay Investments, said in a note Thursday.

Goldman Sachs CEO David Solomon speaks during a business summit in Australia in March. REUTERS

“Businesses may soon start to reverse course and start passing these costs to consumers.”

That would fulfill projections published earlier this week in a report from Goldman Sachs economists, who argued that US consumers will end up bearing the brunt of Trump’s tariffs.

So far, consumers have absorbed just 22% of tariff costs, but this share will likely jump to 67% as businesses start to hike prices, the report said.

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Trump fumed that Goldman Sachs boss David Solomon should go back to “being a DJ” and “get himself a new economist.”

Thursday’s producer price data puts Fed Chairman Jerome Powell – who Trump has pushed to slash rates – in a more complex spot.

“We had the hideous jobs report and that may be more of a worry than inflation at the given moment,” Ken Mahoney, CEO at Mahoney Asset Management, told The Post.

Federal Reserve Chairman Jerome Powell speaks during a press conference in July. REUTERS

“This could be a one-off and there is no pattern here yet, but we will see how this plays out.”

He added that the running joke online seems to be that “whoever put the PPI out will lose their job today because the number was bad.”

Earlier this month, Trump abruptly fired BLS chief Erika McEntarfer after a dismal economic report revealed the labor market has been weakening for months.

The president said he plans to nominate E.J. Antoni, a harsh critic of the department and top economist at the conservative Heritage Foundation, to lead the bureau.

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This comes as President Trump said on Friday he will start talking to China on Monday or Tuesday about a possible TikTok deal.

He said the US “pretty much” has a deal on the sale of the TikTok short-video app.

TikTok plans to launch the new app in the U.S. on Sept. 5, according to The Information. REUTERS

Last month, Trump extended to Sept. 17 a deadline for China-based ByteDance to divest the U.S. assets of TikTok.

TikTok has developed a plan to launch the new app to US app stores on Sept. 5, the report said.

The report added that TikTok users will eventually have to download the new app to be able to continue using the service, although the existing app will work until next March, though the timeline could change.

TikTok did not immediately respond to a Reuters request for comment. Reuters could not immediately confirm the report.

President Trump said Friday that he will begin talking to China this week about a possible TikTok deal. AP

A deal had been in the works earlier this year to spin off TikTok’s U.S. operations into a new U.S.-based firm, majority-owned and operated by U.S. investors. That was put on hold after China indicated it would not approve it following Trump’s announcements of steep tariffs on Chinese goods.

Trump said the U.S. will probably have to get a deal approved by China.

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The embattled Tiffany Network — which has seen ratings plunge at its morning show and evening news program, and is being sued by President Trump for $20 billion over the controversial “60 Minutes” interview with Kamala Harris — fired two CBS News bureau chiefs and a senior executive on Wednesday, sources said.

Andre Rodriguez, the NYC-based North Bureau Chief, and Maryhelen Campa, the Southern Region Bureau Chief, were let go, according to the insiders.

CBS News is quietly slashing jobs ahead of larger cuts at Paramount Global, which are expected this summer. AP

Both had spent two decades at the company.

Chad Cross, senior vice president of the Beats & Enterprise unit, was also canned, the sources added.

He joined CBS News in 2022.

“It’s a streamlining move,” a source close to the situation said.

The cuts are being described internally as “organizational changes to centralize the internal newsgathering process” — and “not an indication of something bigger,” the source added.

Another CBS insider said the network has “no fat left to cut.”

“If someone calls in sick, everyone feels it,” the person added.

CBS News declined to comment.

George Cheeks, co-CEO of Paramount Global and CEO of CBS, is helping negotiate a legal settlement with Trump as the company’s controlling sharholder Shari Redstone is pushing for a resolution Variety via Getty Images

The cuts come amid a report by the Wall Street Journal late Wednesday that Paramount will begin slashing jobs as early as next month in a bid as it awaits approval of the long-stalled $8 billion Skydance merger.

The mass layoffs would follow last year’s brutal bloodbath in which Paramount laid off thousands of employees as part of a $500 million cost cutting plan.

Paramount, which also operates its namesake Hollywood studio, MTV and Showtime, has faced hurdles to close the Skydance deal from President Trump and the Federal Communications Commission.

Currently, Paramount is in talks with Trump’s lawyers over his $20 billion lawsuit over “60 Minutes’” editing of its sit-down with former Vice President Kamala Harris.

Trump’s FCC chair Brendan Carr is also looking into the matter.

Skydance and Paramount are hoping to close its $8 billion merger, but the deal is facing hurdles from President Trump and the FCC. Bloomberg via Getty Images

The Journal also reported that George Cheeks, co-CEO of Paramount Global and CEO of CBS, is helping negotiate the settlement as the company’s controlling shareholder Shari Redstone pushes for a resolution. Cheeks is expected to land a top job once Skydance closes the deal, The Post reported in March.

Trump is reportedly looking for $100 million to settle the lawsuit — much more than what Paramount is willing to fork over.

As previously reported by The Post, Paramount is hoping to settle for between $15 million and $25 million — which is what Trump accepted to recently settle lawsuits against Disney’s ABC and Meta, respectively.

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The Consumer Price Index rose 2.4% over the past 12 months through March, below expectations of a 2.6% rise and beneath last month’s 2.8% figure, the Bureau of Labor Statistics said Thursday.

Core CPI, which excludes volatile food and energy prices, came in at 2.8% — also below projections of a 3% jump and February’s 3.1% figure, according to the government data.

President Trump announces his so-called “reciprocal” tariffs on “Liberation Day.” REUTERS

People shop at a grocery store in Manhattan on April 01, 2025, in New York City. Getty Images

Futures tied to the Dow Jones Industrial Average, S&P 500 and Nasdaq 100 fell 1%, 1.3% and 1.7%, respectively, soon after the report’s release, after making massive strides on Wednesday — with the Dow soaring nearly 3,000 points — after Trump announced a 90-day pause on nearly all tariffs.

The pause was a welcome reprieve for Wall Street, since panicked investors had led a massive week-long sell-off as they worried the taxes could reheat inflation and even trigger a recession, with the Dow losing nearly 5,000 points.

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Minutes from the meeting, released after the typical three-week lag, also showed clear division among the Fed’s 19 policymakers. Some officials expressed support for keeping the central bank’s key rate unchanged, the minutes said. And a majority of the officials said the decision to cut rates was a close call.

Ultimately, the Fed chose to cut its key rate by a quarter-point to about 4.3%. One official, Cleveland Fed President Beth Hammack, dissented in favor of keeping rates unchanged.

The Federal Reserve last month cut its key rate by a quarter-point to about 4.3% in a close-call decision. Chairman Powell, above AFP via Getty Images

Still, there was widespread agreement in the minutes that after reducing rates for three straight meetings, Fed officials felt it was time to undertake a more deliberate approach to their key rate.

Fewer rate cuts will likely mean that borrowing costs for consumers and businesses — including for homes, cars, and credit cards — will remain elevated this year.

Policymakers said that the Fed “was at or near the point at which it would be appropriate to slow the pace of policy easing,” the minutes said. In projections released after the meeting, Fed officials said they expect just two cuts next year, down from an earlier projection of four.

The minutes also showed that “almost all” Fed policymakers see a greater risk than before that inflation could stay higher than they expect, in part because inflation has lingered in several recent readings and because of “the likely effects of potential changes in trade and immigration policy.”

The Fed’s staff economists considered the economy’s future path particularly uncertain at the December meeting, in part because of the incoming Trump administration’s “potential changes to trade, immigration, fiscal, and regulatory policies,” which the staff said are difficult to assess in terms of how they will impact the economy. As a result they included several different scenarios for the economy’s future path in their presentation to policymakers.

Fed officials have started to consider the potential impact of President-elect Trump’s proposals, such as widespread tariffs, on the economy and inflation next year REUTERS

And the staff projected that inflation this year would be about the same as in 2024 because they expected Trump’s proposed tariffs would keep inflation elevated.

Fed officials sent stock markets plummeting Dec. 18 after they reduced their outlook for rate cuts. Fed Chair Jerome Powell said at a news conference after the meeting that the decision to reduce rates had been a “close call.”

Powell also said that recent signs of stubborn inflation have caused many Fed officials to pare back their expectations for rate cuts. Inflation, according to the Fed’s preferred measure, ticked up to 2.4% in November, compared with a year ago, above the Fed’s target. Excluding the volatile food and energy categories, it was 2.8%.

Inflation, according to the Fed’s preferred measure, ticked up to 2.4% in November, compared with a year ago, above the Fed’s target. Excluding the volatile food and energy categories, it was 2.8%. AP

In addition, some officials have started to consider the potential impact of President-elect Trump’s proposals, such as widespread tariffs, on the economy and inflation next year, the minutes said.

Economists at Goldman Sachs, for example, have estimated that Trump’s tariff proposals could push inflation by nearly a half-percentage point later this year.

Earlier Wednesday, Fed governor Christopher Waller said that he still supported rate reductions this year, in part because he expects inflation to steadily head down to the Fed’s 2% target. He also said he didn’t expect tariffs would worsen inflation and wouldn’t change his preference for lowering borrowing costs.

Waller also said, in a question and answer session, that he didn’t think Trump would ultimately impose the universal tariffs he promised in the campaign.

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