US producer-price inflation figures surprise to the upside

 
The latest US producer-price inflation figures for July came in a little stronger than expected, with final demand year-on-year at 0.8% compared to a forecasted 0.7%, largely due to stronger performance within the services sectors. The energy component was up the least on the month, suggesting the rally in commodities has yet to feed through, whilst trade services were up the most. Unfortunately for markets, much of the upside momentum has been sapped, with the technology sector weighing in on US equity markets. Moving forward, a key focus will be the Federal Reserve's next rate decision due in September, which may tip the odds in favour of another 0.25% hike. However, a pause remains to be the base case.