Pound rallies as US PPI inflation falls; insolvencies jump as UK economy weakens – as it happened

A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan. Photograph: Andrew Kelly/Reuters

3.08pm GMT

Closing post

Time to wrap up… here are today’s main stories:

2.53pm GMT

Full story: US wholesale inflation eases to 8%, 4th straight slowdown

Prices at the wholesale level rose 8% in October from a year ago, the fourth straight decline and the latest sign that inflation pressures in the United States are easing from painfully high levels, Associated Press report.

The annual figure is down from 8.4% in September. On a monthly basis, the government said Tuesday that its producer price index, which measures costs before they reach consumers, rose 0.2% in October from September. That was same as in the previous month, which was revised down from an initial reading of 0.4%.

The figures came in lower than economists expected and make it more likely that the Federal Reserve will increase its benchmark interest rate in smaller increments. It has hiked its short-term rate by three-quarters of a point for four meetings in a row, but economists now increasingly foresee an increase of a half-point at its December meeting.

US PPI +8% in October. pic.twitter.com/KFdhGPx4Ff

— Growth & Value (@Growth_Value_) November 15, 2022

Rubeela Farooqi, chief U.S. economist at High Frequency Economics, a forecasting firm, says:

“The improvement in the October inflation data, if it persists, supports the Fed’s expectation of a step down in the pace of increases going forward.”

Most of the monthly increase reflected higher gas prices at the wholesale level, which rose 5.7% just in October. The cost of new cars fell 1.5%, last month, which could lead to lower prices at the retail level as well.

Excluding the volatile food and energy categories, core producer prices were unchanged in October from September, the lowest reading in nearly two years. Core prices increased 6.7% last month from a year ago, down from a 7.1% annual rate in September.

The cost of services, such as hotels, air travel, and health care, slipped 0.1% in October from September, the first drop since November 2020.

More Signs of Inflation Moderation. The Producer Price Index continued the recent trend of slowing inflation, as October’s core PPI was flat (+0.01% M/M). On a three-month annualized basis, core PPI is rising only 2.3%, moving towards the Fed's target of 2% inflation. pic.twitter.com/Yw18o5ChPy

— Larry Adam (@LarryAdamRJ) November 15, 2022