PPI Report Could Suggest an Interim Rate Cut by Fed
Wall Street has been rife with speculation about what the Federal Reserve’s next move will be with regard to interest rates, and a number of economic reports due this week could yield some clues. The Fed is widely expected to cut rates in an effort to jump-start economic growth, but whether it will slash rates again before its May 15 meeting is open to question. On Thursday, the government will release the producer price index, which is expected to show an overall reading of unchanged in March and a 0.1% gain in the core rate, which excludes volatile food and energy prices, according to a Reuters survey of economists. Retail sales figures, also set for release Thursday, are expected to be flat for March. “It would add to the speculation about an interim move if we get a lower core rate of PPI and the retail sales are soft,” said Tony Dwyer, chief market strategist at Kirlin Holdings.
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Other economic data due this week:
* Wednesday, the Labor Department will report on March import prices.
* Friday, the Commerce Department will report on February business inventories.
* Friday, the University of Michigan will issue preliminary results of its survey of March consumer confidence.
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