US PPI preview: can producer prices cool after September’s 1.3% jump?

The US releases its October Producer Price Index (PPI) today, Friday, 13 November 2026, at 13:30 UTC. It’s the second inflation report of the week, after Tuesday’s consumer price data came in hotter than forecast. With markets already expecting the Federal Reserve (Fed) to raise interest rates in December, today’s numbers could help decide how big that move might be.

What PPI measures, in plain terms

PPI tracks the prices that US businesses get paid for the goods and services they sell. It covers things like fuel sold by refineries, food sold by farms and wholesalers, and services such as transport, warehousing and financial advice.

Think of a bakery. If the price of flour, electricity and delivery goes up, the bakery’s costs rise first. Sooner or later, it may raise the price of bread. PPI picks up the first part of that chain, which is why traders watch it as an early signal for the prices shoppers pay later.

There are two main numbers:

• Headline PPI includes everything.
• Core PPI leaves out food and energy, because their prices jump around a lot. It gives a better view of the underlying trend.

September was a big month

Producer prices rose 1.3% in September alone, the biggest monthly rise since March 2022. Energy was the main reason. Energy prices for producers jumped 10.8% in the month and made up about half of the overall rise.

It wasn’t only energy, though. Core PPI rose 0.7%, and compared with a year earlier, headline PPI was up 6.3%, the highest since December 2022.

What’s expected for October

• Headline PPI: up 0.4% on the month, after 1.3%
• Core PPI: up 0.3% on the month, after 0.7%
• Headline PPI, year on year: 6.6%, after 6.3%

Producer price inflation spent most of 2024 and 2025 between 2% and 4%. It started climbing in the spring of 2026 as energy costs surged, and a 6.6% reading for October would be the highest since November 2022.

That may look odd at first. How can prices rise more slowly on the month, while the yearly number goes up? The answer is in last year’s data. In October 2025, producer prices rose only about 0.2%, so that quiet month now drops out of the yearly comparison. Even a normal rise this October could push the yearly rate higher. That’s why the monthly numbers, especially core, are the ones traders are likely to focus on.

Why the Fed cares about producer prices

The Fed’s favourite inflation gauge isn’t the Consumer Price Index (CPI). It’s the Personal Consumption Expenditures (PCE) price index, and some of its parts come straight from the PPI report rather than from CPI. These include airfares, health care costs and fees charged for managing investments.

So after today, economists could update their estimates for October PCE, which is due on 25 November. A hot PPI could push those estimates up, even though CPI is already out.

Here’s where the Fed stands:

• It’s already raising rates. The Fed hiked to 3.75% to 4.00% in September, then held on 28 October, with two officials voting for another hike.
• Inflation stayed hot in October. CPI rose 0.4% on the month against a 0.3% forecast, and core CPI rose 0.3% against 0.2%.
• The bigger hike debate is open. Fed Governor Christopher Waller said earlier this week that a 50 basis point hike should be considered if core CPI came in around 0.3% or higher. It came in at 0.3%. A basis point is one hundredth of a percentage point, so 50 basis points is 0.5%.
• The next decision is on 9 December, at the end of a two day meeting.

Markets see a December hike as close to certain. CME FedWatch, which turns interest rate futures prices into odds for each Fed meeting, shows an 86.7% chance of a 25 basis point hike on 9 December and a 13.3% chance of a bigger 50 basis point hike. It puts the chance of no change at zero.

How markets could react

• Hotter than expected (headline above 0.4% or core above 0.3%): this could add to talk of a bigger 50 basis point hike in December. US Treasury yields and the US Dollar (USD) could rise, which may put more pressure on gold, stocks and crypto.
• In line: this would likely keep a 25 basis point hike as the main expectation. Traders may then look at the details, such as how much of the rise came from services.
• Cooler than expected (especially a soft core reading): this could ease some of the pressure for a bigger hike. Yields and the dollar may pull back, which could give gold and riskier markets some breathing room.

Bond markets are already on edge. The US 10 year Treasury yield is back above 5%, so any surprise today could have a big effect.

Gold heads into PPI under pressure

In our last gold article, gold was holding the bottom of its range near $4,000 after Tuesday’s hot CPI report. That area has since given way. Gold has lost about 6% from this week’s high as rising yields and a firmer dollar weighed on it, and it trades around $3,898 at the time of writing. Gold pays no interest, so when US government bonds pay over 5%, holding it becomes less attractive for some investors.

Gold (XAU/USD) on the daily chart. Price has slipped below the support zone that held for most of the past year, with the next major support zone much lower.

Here are the levels on the daily chart:

• The broken support zone: gold spent most of the past year holding a zone between $3,933 and $4,170. Price is now trading below the bottom of it. While gold stays under $3,933, that zone could act as resistance, which is a level where sellers may step in.
• The next major support: the next big zone on the chart sits between $3,200 and $3,440, where gold moved sideways for months in mid 2025. If the break holds, price could potentially work its way down towards that area over time.
• What would change the picture: a move back above $3,933 would suggest the break has failed, and gold would be back inside its old zone. Above that, $4,299 is the next resistance.

A hot PPI report could add to the pressure on gold if yields and the dollar keep climbing, while a softer reading may give it room to climb back towards the broken zone.

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