HVAC wholesale prices hold steady in September

U.S. wholesale prices of HVAC equipment in September were little changed from the prior month but remain elevated compared to last year, the Bureau of Labor Statistics reported Tuesday. 

What’s happening: An HVAC-specific ‘producer price index’ (PPI), which measures the average change in selling prices that domestic manufacturers receive for their products, fell just 0.1 percent from August but rose five percent year-over-year. (The report was originally scheduled for mid-October but was delayed by the government shutdown.)

• September marked the second consecutive month when wholesale prices held steady compared to the prior one, following a sharp climb from March through July of this year. 
• The index is now up 51 percent compared to September 2020. 

Zoom out: Because the PPI measures wholesale price changes — before they reach consumers — it’s widely seen as a leading indicator of inflation. 

• Across all industries, the index rose 0.3 percent from August and, excluding food and energy, 2.6 percent year-over-year — the smallest gain since July 2024.  

The big picture: Tuesday’s release is among the final data the Federal Reserve will see before deciding whether to cut interest rates at its next meeting in December. 

• “For now, December’s Fed meeting looks to be contentious, with officials appearing divided on whether to opt for a third straight quarter-point rate cut to cushion a weakening labor market, or whether to hold rates steady to lean more against persistent inflation,” the Wall Street Journal reports. 

Looking ahead: The Bureau of Labor Statistics did not announce a date for the release of October’s producer price index.