PPI Stays Flat Despite Tariff Predictions

Producer Prices Flat in June, The U.S. economy threw another curveball at economists in June. The Producer Price Index (PPI), a key gauge of wholesale inflation, showed no change month-over-month. This defied the expectations of analysts who projected a 0.2% increase. The latest report from the Bureau of Labor Statistics (BLS) proves yet again that mainstream economists continue to misjudge the impact of President Trump’s trade policies.

While many critics insisted tariffs would push inflation higher, real data shows otherwise. The PPI held steady, and even core PPI, which excludes food and energy, came in flat — also under expert projections.

White House Celebrates Stable Prices

The Trump Administration quickly responded to the data. White House Press Secretary Karoline Leavitt stated, “Every month since President Trump took office, core inflation has either met or beaten expectations. The data proves the President’s policies are working.”

She emphasized that inflation has stabilized under Trump’s leadership. The Biden-era warnings about tariffs causing spikes in consumer prices appear increasingly baseless.

Annual Wholesale Inflation Cools

On a year-over-year basis, the numbers tell a similar story. Headline PPI rose 2.3% in June, down from 2.7% in May — the lowest annual increase since September 2024. Meanwhile, core PPI increased 2.6%, marking the smallest gain since July of the previous year.

These trends support the view that tariffs have had minimal impact on overall inflation. Despite constant fearmongering from critics, American producers and consumers haven’t faced the spike in costs predicted.

Tariffs Have Minimal Impact, Say Experts

CNBC acknowledged the surprising outcome. In its coverage, it noted that the combined data from the PPI and Tuesday’s Consumer Price Index (CPI) release suggests that Trump’s tariffs are having only a marginal effect on prices.

Even Vice President JD Vance joined the conversation. On social media platform X, he commented, “It’s almost like the economics profession doesn’t fully understand tariffs.” His jab at economic experts resonated with many Americans tired of failed predictions.

Trump Pressures Fed for Rate Cut

With inflation cooling, President Trump is pressing the Federal Reserve to slash interest rates. On Tuesday, he urged the Fed to cut rates by three points, claiming that “One Trillion Dollars a year would be saved!!!”

The Fed is set to meet at the end of July. Rumors are already swirling that Chair Jerome Powell may consider stepping down. If that happens, Trump will have even greater influence over future monetary policy.

Consumer Inflation Ticks Up Slightly

Despite stable wholesale prices, consumer inflation crept up slightly in June. The Consumer Price Index rose 0.3% month-over-month, and 2.7% year-over-year. Even so, the White House stated inflation remains “on the right track.”

This mixed signal hasn’t slowed the Administration’s optimism. With tariffs set to take effect globally on August 1, Trump appears confident that his “America First” economic strategy will continue to outperform expectations.

Economists Scramble to Reassess

June’s PPI numbers have forced economists to re-evaluate. Their models have consistently overestimated the negative impact of tariffs. Now, they face growing scrutiny from both the public and policymakers.

With markets stable and inflation under control, Trump’s economic agenda is gaining momentum. As wholesale prices stay flat and annual inflation cools, the data speaks for itself.

Conclusion: Real Data Beats Predictions

Once again, President Trump’s critics find themselves contradicted by the numbers. Wholesale inflation in June stayed flat, and core metrics followed suit. Tariffs, far from destroying the economy, seem to have little to no impact on consumer prices.

This economic stability supports Trump’s calls for interest rate cuts and reaffirms the effectiveness of his bold trade stance. Economists may want to rethink their models, because reality isn’t following their forecasts.

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