Traders Trim Bets on Fed Rate Cut After Jump in US Wholesale Prices

Wall Street traders dialed back expectations for an interest rate cut in September, sending Treasury yields higher, after a bigger-than-expected jump in US wholesale prices signaled tariffs are pushing up inflation.

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NEW YORK -

Yields on short-term Treasuries, which tend to track expectations for monetary policy, rose sharply on Aug. 14, with the two-year note's yield climbing six basis points to 3.73 per cent.

The benchmark 10-year yield jumped and the US dollar gained against a basket of peers.

The jump in the producer price index (PPI) - which suggests companies are passing along elevated import costs tied to tariffs - halted a Treasuries rally and surprised investors.