The economic calendar is empty today — but nobody’s relaxing. Thursday brings the August Producer Price Index, Friday delivers the Consumer Price Index, and both reports land barely a week before the Federal Reserve’s September 15–16 policy meeting. Add in crude oil brushing $96 a barrel and Canada’s new retaliatory tariffs taking effect yesterday, and the inflation picture is getting complicated fast.
Markets felt the weight on Tuesday. The Dow dropped 628 points (1.18%), the S&P 500 shed 0.6%, and the Nasdaq slipped 0.3%. The selloff had two drivers: oil surging toward triple digits on fresh Middle East attacks, and Amgen shares cratering in their worst single-day performance in more than two decades — dragging the entire health-care sector down with them.
Here’s what to watch as the inflation data arrives — and why this week matters more than most.
The Inflation Doubleheader
Thursday: PPI (August)
Consensus: +0.4% month-over-month, +5.3% year-over-year, per MarketWatch. Core PPI (excluding food and energy) is expected at +0.3% MoM. For context, July’s PPI came in flat at 0.0% MoM — below the 0.2% consensus. A jump to +0.4% in August would be the largest monthly increase since early 2026 and would signal that producer-level price pressures aren’t fading as hoped. Wholesale trade inventories and existing home sales also drop Thursday morning, but PPI is the main event.Friday: CPI (August)
Consensus: +0.4% MoM headline, +0.2% MoM core, per Reuters. The Cleveland Fed’s inflation nowcasting model — updated September 8 — pegs August CPI at +0.36% MoM and core CPI at +0.20% MoM. On a year-over-year basis, the model forecasts headline CPI at 3.38% and core at 2.38%. Those are numbers the Fed won’t like. Headline CPI above 3.3% would mark the second straight month of acceleration after July’s 3.2% reading. Core CPI at 2.38% YoY is closer to the 2% target — but the direction of travel on headline is what spooks markets.The Fed’s Calculus
The FOMC meets September 15–16 — six days after the CPI print. These are the final major inflation reports before the decision, and the implications are binary:- Hot prints fuel hike odds. If both PPI and CPI come in at or above consensus, a quarter-point rate hike shifts from possible to probable. Barclays economists noted after Friday’s jobs report that the employment data “marginally” strengthens the case for a September hike, and “attention now shifts to next week’s inflation data.”
- Cool prints buy a pause. If the data undershoots — especially if core CPI slips below 0.2% MoM — the Fed gets room to hold steady and wait for clearer signals. A pause doesn’t mean the hiking cycle is over, but it would ease immediate pressure on bonds and equities.