What Inflation?

What inflation? Today's PPI release was a surprise to most traders, with a benign rise of only 0.1% last month. More shocking was the so called "core" reading, which posted a surprising drop of 0.4% in August. This report, coupled with an inflation neutral CPI report on Friday, has nearly wiped out any chance of an interest rate increase at tomorrow's FOMC meeting, according to Fed Funds traders. Traders also were greeted by US housing starts in August, which fell 6% to 1.67 million. Read More....