The Federal Reserve is set to make a policy decision at the FOMC meeting scheduled for September 15–16. The outcome depends on inflation data for August, which will be released on September 10 and 11.
The producer price index (PPI) for August is expected to show a monthly gain of 0.4%. Analysts project the consumer price index (CPI) to rise by 0.4% monthly and 3.4% year-over-year.
The current federal funds rate target is 3.50%–3.75%. Fed Governor Christopher Waller indicated that August inflation readings will influence the decision on a potential 25-basis-point hike, which would raise the target to 3.75%–4.00%.
As of June, headline PCE was 3.7% year-over-year, while core PCE stood at 3.3%, both remaining above the Fed's 2% target. A Reuters poll conducted September 4–9 shows that about 70% of economists expect rates to remain unchanged through 2026.
