The Federal Reserve’s Federal Open Market Committee voted unanimously today to lower its target for the federal funds rate 50 basis points (0.5 percentage points) to 4.75%.
The producer price index (PPI) for finished goods fell 1.4% in
August, seasonally adjusted, the Bureau of Labor Statistics (BLS) reported
today. Over the past 12 months, the finished-goods PPI rose a modest 2.2%. The
PPI for inputs to construction industries dropped 0.8% for the month and rose
just 1.6% over 12 months. However, since December 2003, when construction
materials prices started jumping, the cumulative change in the construction
inputs PPI was 28%, compared to 15% for the finished-goods PPI and 13% (through
July) for the consumer price index for all urban consumers (CPI-U; the August
CPI-U will be released tomorrow).