US PPI data hit a new low in nearly 8 months

The decline in inflation has increased expectations that the Federal Reserve has already completed interest rate hikes

On Wednesday (November 15th), data released showed that the monthly retail sales (PPI) rate in the United States recorded -0.1% in October, setting a new low since March this year. At the same time, the monthly PPI rate in the United States in October recorded -0.5%, the largest decline since April 2020.

Oil prices fell more than 2% on Wednesday (November 15th) due to a higher than expected increase in US crude oil inventories, a record high global production of the largest oil producer, and heightened concerns about Asian demand, putting pressure on crude oil prices. WTI December crude oil futures closed down $1.60 per barrel, a decrease of 2.04%, at $76.66 per barrel.

Due to the slower than expected decline in retail sales data in the United States in October, gold prices are facing some pressure. However, the easing of price pressure on the US economy has weakened the Federal Reserve's bet on further tightening policies, so broader demand for precious metals remains optimistic. Precious metals have benefited from the slow growth of overall inflation in the United States, while a significant drop in gasoline prices has led to a slowdown in inflation. The October weak inflation report in the United States indicates that the current interest rate set by the Federal Reserve is sufficient to reduce inflation to 2%.

Due to the weak Consumer Price Index (CPI) supporting risk appetite, the US dollar and bond yields have declined. The easing of consumer inflation has increased investors' confidence in the possibility of early interest rate cuts by the Federal Reserve.