Is Wholesale Inflation Breaking the Fed’s Last Line of Defense?

April’s Producer Price Index rose 1.4% month-over-month, far above the 0.5% consensus estimate, pushing wholesale inflation to 6.0% year-over-year — the hottest reading since December 2022. The print landed one day after CPI came in at 3.8% annually, completing a two-day inflation shock that drove S&P 500 futures down 0.7% and the 10-year Treasury yield to 4.46%. With the Fed’s next meeting on June 16–17 and a new chair potentially at the helm, traders are repricing the odds of any near-term rate cut toward zero.