It’s all about inflation, and when the Bureau of Labor Statistics (BLS) makes revisions, like they did in March, it becomes difficult to determine the true inflation figures.

The Producer Price Index (PPI) report, which measures wholesale or producer inflation, rose by 0.5% in April. That is a much hotter number than the expected 0.4%.

The reason for this disparity lies in how these numbers are calculated. Inflation is based on a comparison of previous data, either from the last month or the last year as an example. Remember Inflation is the change in pricing from a previous data point.

Tomorrow’s Consumer Price Index (CPI) should shed some light on inflation, as it is a more crucial data point than the PPI.

What this means is the Feds should start thinking rate cut starting in June and potentially cutting mid summer. This is a positive outlook for interest rates.