Expected March PPI Surge Could Solidify Federal Reserve Rate Cut Delays
RW
Riley Winters
Fed interest rate decision · Apr 14, 2026
Source: DojiDoji Data Terminal
New vehicle prices and food costs are rising as upstream corporate costs increase. Used-car prices have hit a near three-year high, driven by a spike in the automobile manufacturing index, which is highly dependent on steel, aluminum, and plastics. Fertilizer costs have also increased, keeping food prices high. These costs are the result of a manufacturing price index that surged to 78.3 in March, the highest level since June 2022, and a services price index that climbed to 70.7%.
Brent crude futures surpassed $100 on March 8 for the first time since mid-2022. This occurred as shipping through the Strait of Hormuz, which transports 20% to 30% of global crude oil, nearly stalled due to the conflict between the U.S. and Iran. Gasoline prices surged 21.2% in a single month, while the energy component of the PPI soared 12.5% year-on-year.
Market forecasts expect the annual rates for both U.S. March PPI and core PPI to surpass 4%, with the annual PPI rate potentially reaching 4.6%. Should these figures exceed 4%, market expectations that the Federal Reserve will abandon rate cuts this year will be reinforced. Fed Chair Jerome Powell has stated there will be no rate cuts without progress on inflation. Rate cuts are unlikely in the first half of the year.