Bank of America warns that rising business costs could soon translate into higher prices for American consumers. The bank's analysis follows May data showing the Producer Price Index jumped 1.1% for the month and 6.5% year-over-year, the largest 12-month increase since November 2022, driven by a 10.7% surge in energy prices and a 23.4% spike in gasoline at the producer level. After the PPI report, BofA raised its core PCE tracking estimate to 0.35% month-over-month, which could push annual core PCE inflation to 3.4%, up from a prior estimate of 3.3%. The firm cautioned that sustained cost pressures in energy, freight, food, and goods may force retailers to pass expenses on to shoppers, while elevated inflation could keep the Federal Reserve from cutting interest rates, adding to household borrowing costs.
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NVIDIA CorporationFedEx CorporationHigher freight costs and potential consumer spending slowdown could hurt FedEx's shipping volumes.
Bank of America Corp