We're back now with breaking news on the fight against inflation. - Yeah the Producer Price Index⁽¹⁾ which measures inflation based on the prices companies.

And producers pay for goods and services rose four-tenths of a percent in the month of September, that is double what the experts were expecting, and that's up 8.5 percent year over year.

So joining us now to break down those numbers and what they mean for you, is Caleb Silver, he's the editor-in-chief of Investopedia⁽²⁾.

Caleb, good morning, what is your take on this report? is this a sign that inflation hasn't yet peaked?

Yeah, it hasn't apparently, this is persistently high, we're looking at producer prices, this is like looking in the rearview mirror, because we're looking at September numbers.

The thing about producer prices guys is that they forecast consumer prices, because this is demand at the wholesale level, which then retailers and stores pass on to us as consumers.

So this shows that it's persistently high when you strip out food and energy⁽³⁾ like you need to do sometimes, because those prices are volatile.

It rose at a 5.4 percent annual rate, but not cooling enough to change the FED's mind about what it's going to do with interest rates.

Caleb always good to see you at Savannah, so tomorrow we're going to get another important read on this on inflation where we're at Consumer Price Index⁽⁴⁾.

That measures the cost regular consumers have to pay for those services and goods, as Scotty just said, we're talking more companies producers that kind of thing.

But now just what does it mean for our wallet, so give us some insight on what we could see tomorrow.

Yeah, we're going to get the Consumer Price Index that does measure what we pay on the consumer level for the past month.

And we're at a 40-year high, still at about 8.1 percent, I don't expect we're going to come down too far from that, that said, if you look what's happening inside the commodity complex.

I'm talking about oil prices which have drifted a little bit higher lately, but look at copper, look at timber, look at lumber⁽⁵⁾, some of these other commodities, they've come way down.

Oil prices are starting to peak again and they did for the past few weeks, so you're going to feel that in the Consumer Price Index, we're definitely continuing to pay more now folks are worried about gas prices drifting a little bit higher and they have been.

But look at those other prices, what about food? What about rent? what about utilities? all of those have been very high for the past several months, and that is starting to make consumers pull back a little bit.

And what about rate hikes right? So Caleb, how important are these numbers to the Federal Reserve as they're trying to ease inflation? What's it going to take to convince the FED to maybe slow down some of those rate hikes?

Yeah, well, consider this, the FED's target rate for inflation is around 2 percent, we're looking at about 8.1 percent right now, so we're very far away from that.

And until the FED sees that number come down, consumer inflation and the PCE the Personal Consumption Expenditures index come down closer to 2 percent, they're going to keep hiking rates.

So expect another rate hike in November, expect another rate hike in December, to end out the year, the FED wants that prime rate that federal funds rate to be around four and a half percent.

We're at about three and a quarter percent right now, so we got a ways to go, and none of these reports are going to change its mind.

Yeah, all right, Caleb, quickly also what about Wall Street what impact is this going to have? Especially with the weakness we've seen in the stock market in the past few days.

Yeah, the stock market has been back and forth on this, it's really listening closely to earnings, investors are listening to what companies are saying, we're in that report card period of the Year.

PepsiCo reported this morning pretty robust results, but when companies are missing or taking their guidance lower for the rest of the year, that continues to scare off investors.

That's the drumbeat we've heard so far, we're going to see choppiness in the stock market for the rest of the year at least. - Caleb Silver, Investopedia, Thanks so very much, thanks Caleb.