Evelyn Reynolds

During the Covid pandemic, millions of workers quit their jobs
Fast forward to 2025 and many workers are staying put, while businesses are putting the brakes on hiring or firing
Economic uncertainty has made both employees and employers nervous

Casarsaguru | E+ | Getty Images

Millions of workers left their jobs during the “Great Resignation” of the Covid-19 pandemic, but economic insecurity and uncertainty have once more turned the tides of the labor market toward the “Great Stay.”
Economists coined the term to refer to fewer employees leaving jobs, and fewer employers hiring or firing new workers.

“We had this ‘Great Resignation’ just a couple of years ago,” Nela Richardson, chief economist at ADP, told CNBC. But now, “workers aren’t going anywhere,” she noted.
“They’ve got their dream job, which is probably partly at home, maybe with a big salary pickup … And what we actually see in the data is very low turnover, which is very unusual in the U.S.,” she added.
“I call it the ‘Great Stay.’ People are staying put. They’re not leaving. And they’re staying put in things like IT and software development, where you would normally see a lot of turnover,” she noted.

Likewise, Richardson said firms were putting hiring decisions on hold “because they’re uncertain about the road ahead, not necessarily because they’re trying to reduce their headcount.”
Describing the trend as a “no-hire, no-fire market,” Richardson said the momentum is clearly slowing in terms of hiring, although initial U.S. jobless claims — a proxy for layoffs — are still near historical lows.

“We think it’s no-fire, no-layoff [environment] right now because firms are so reluctant to let people go, because it took so long in the U.S. to get them back.”

The turnaround from the “Great Resignation” is dramatic: the Covid-19 pandemic ended the longest employment and economic expansion in U.S. history, according to the U.S. Bureau of Labor Statistics, with around 50.5 million people quitting their jobs in 2022, up from 47.8 million in 2021.
But there are signs that the U.S. jobs market is cooling; nonfarm payroll growth came in at a slower-than-expected 73,000 in July, the latest data from Aug.1 showed, while the unemployment rate ticked higher to 4.2%.
The weak report could provide an incentive for the U.S. Federal Reserve to lower interest rates when it next meets in September, economists said.

UK seeing similar shift

A similar trend was seen in the U.K., where the number of job vacancies rose to a record 1,172,000 over the August-October 2021 period, according to the Office for National Statistics. By the second quarter of 2022, the total number of job vacancies had reached 1,295,000, the ONS said.
Fast forward to 2025 and the latest U.K. jobs data, released mid-August, showed the country’s labor market continued to cool with job vacancies falling by 5.8% to 718,000 between May to July in 16 out of 18 industry sectors, according to the ONS.
It added that “feedback from our Vacancy Survey suggests some firms may not be recruiting new workers or replacing workers who have left.”

Shoppers pass along the high street in Maidstone, UK, on Wednesday, April 16, 2025.
Bloomberg | Bloomberg | Getty Images

The U.K. economic inactivity rate — reflecting the number of people aged between 16-64 who are not in work and not actively looking for work — was estimated at 21% in April to June 2025, the ONS said.
“Business hiring has been continuously dropping for the past 3 years, with recent dips spurred in part by higher labour costs from tax rises and the minimum wage hike, as well as overall economic uncertainty,” noted Monica George Michail, associate economist at the National Institute of Economic and Social Research think tank.
“Meanwhile, falling inactivity and rising unemployment are increasing the supply of labour.”

Neil Carberry, the chief executive of the Recruitment and Employment Confederation, told CNBC that Britain was also seeing a “Big Stay” trend, with firms reluctant to go on a hiring spend until they have a better understanding of the trajectory of the U.K. economy, which has been experiencing lackluster growth.
“The truth is, jobs are created by businesses, and the engine of job creation is growth … Unless you get business in a position where they want to hire in the United Kingdom, you’re not going to get anywhere,” he told CNBC.
“On the market at the moment, it’s quite odd. Permanent recruitment has been low for two or three years now, and it hasn’t quite come back [since Covid-19], but businesses are just, like, sitting there with a hand over the button. So what lots of our members say is that they can see what they’re going to do, they just want a bit of confidence to do it.”
— CNBC’s Jeff Cox and Greg Iacurci contributed reporting to this story More

Fears of a slowing economy and worries about tariffs have spurred young Americans to point out so-called recession indicators.
Some businesses are also picking up on the trend, with dining establishments and bars offering “recession specials.”
Consumer sentiment has been on the decline, according to data from the University of Michigan.

A sign outside Brooklyn coffee shop Clever Blend offers a $6 gelato and espresso “recession special.”
Lisa Kailai Han | CNBC

As fears of a slowing economy lurk in the background, some businesses are taking notice and bringing back so-called recession specials.
Look up the term “recession specials” through Google’s search engine, and the list of results will include entries from the Great Recession nearly 20 years ago.

Consider this Grub Street article from 2008 slugged “Recession Specials: Your Definitive Guide.” Or this 2009 story from The New York Times, which details the mealtime recession specials restaurants across New York offered as an act of survival.
Fast-forward to 2025 and a crop of establishments are once more hinting at a looming economic downturn.
When ‘recession’ returns as a selling point
Recession fears were heating up this spring as President Donald Trump rolled out a slate of tariffs in early April. The term “recession indicator” entered the vernacular of social media users as a tongue-in-cheek way of gauging a potential economic slowdown.
Businesses are now getting in on the joke as well. For instance, Brooklyn, New York coffee shop Clever Blend advertises a $6 gelato and espresso “recession special.”
Wicked Willy’s, a bar in Manhattan, got on board by offering a “Recession Pop Party” earlier this month, with one caption on an Instagram post declaring: “The recession is BACK! Get ready to dance and party all night long!”

Market Hotel, a Brooklyn concert venue, advertised a similar event. “From The Fame to Animal, Circus to Rated R, we’re serving economic anxiety with a side of electro-pop, bloghaus, and auto-tuned glam,” an Instagram caption for the event read. “Dress like rent’s due and you’re dancing through it.”
But the trend doesn’t just stop in New York. Super Duper, a burger chain with 18 locations across the San Francisco Bay Area, tapped in earlier this year with its own “Recession Burger,” a seasonal special introduced in the summer.
“THE ONE THING THAT DIDN’T GET THE INFLATION MEMO: Meet the Recession Combo, our new Seasonal Special,” a post from Super Duper’s Instagram reads. The meal includes a “Recession Burger,” fries and a beverage for $10.

An Instagram post from Super Duper Burgers advertises its summer “Recession Combo” special.
Courtesy: Super Duper Burgers via Instagram

The idea for the burger’s name didn’t necessarily come from a desire to cash in on the buzzword, said Ed Onas, Super Duper’s vice president of operations. Instead, he said, the moniker was derived from the Depression-era origins of the Oklahoma-style smash burger, which aimed to stretch ground beef by adding lots of sliced onions.
But once Super Duper established the burger’s name, the chain decided to offer a discounted “Recession Combo” for $10. This would save customers $5 from the normal price of the add-ons, Onas said.
“That’s kind of where the name of the burger plays in … And we figured, we’re calling it the ‘Recession Combo,’ why don’t we just offer a deal that makes it a really good value for our guests?” Onas told CNBC in an interview. “Inflation has kind of been going on, and we figured it’s a nice offer for a short amount of time for our guests.”
This extra-value combo meal was an exception for Super Duper, which normally doesn’t offer such deals. The burger went viral in a local San Francisco subreddit, with a post gaining 1,400 upvotes and 170 comments.
“Obviously, we were happy about it. We didn’t realize that it was going to get as much attention as it did,” Onas said. “We were happy, and our guests were happy, and at the end of the day, that’s what it’s all about.”
As a testament to the burger’s overwhelming success, Onas told CNBC that Super Duper will be adding it onto its menu as a permanent fixture going forward.
Shedding light on waning consumer sentiment
These small businesses getting in on the trend could be a broader reaction to waning consumer confidence. Consider that the University of Michigan’s consumer sentiment index came in at 58.6 in August, down from a reading of 61.7 in July and reflecting a 13.7% change on a year-over-year basis.
This souring in sentiment has been driven primarily by concerns over trade policy, said Joanne Hsu, director of the surveys of consumers at the University of Michigan.
“What’s very clear from the consumer sentiment data is that consumers are broadly bracing for a slowdown in the economy and a deterioration — not just with inflation, expecting inflation to get worse — but they’re also expecting businesses conditions to deteriorate,” she said. “They’re expecting labor markets to weaken and unemployment rates to go up. And what you’re seeing with these businesses could be a reaction to that.”
A lack of consumer confidence — and trust in income reliability — will ultimately lead to a pullback in spending, Hsu added.
“Young people are feeling just as bad about the economy as older folks, and in some months they feel even worse than older folks,” she said. “Across the age distribution, people agree that the trajectory of the economy has soured.” More

Spain’s gross domestic product surpassed expectations in the second quarter, growing 0.7%, above a forecast of 0.6%.
Investment and consumption are the main key drivers for this growth, as well as a booming tourism sector.
“Spain is a great outlier now in terms of growth. It’s also a great place to invest,” Spain’s Finance Minister Carlos Cuerpo told CNBC.

Tourists take photos as they visit the Sagrada Familia basilica in Barcelona, on August 2, 2025. (Photo by Manaure QUINTERO / AFP) (Photo by MANAURE QUINTERO/AFP via Getty Images)
Manaure Quintero | Afp | Getty Images

Spain’s booming economy is outpacing its European neighbors as tourism, foreign investment and immigration helps fuel growth.
The southern European country is still leading growth in the euro zone with annual gross domestic product forecasted to rise 2.5% this year, while the economies of France, Germany and Italy are respectively forecast to expand 0.6%, 0% and 0.7%.

Spain’s GDP surpassed expectations in the second quarter, growing 0.7%, above a Reuters forecast of 0.6%. The growth was also higher than the previous three months, which levelled at 0.6%, data from the Spanish National Statistics Institute (INE) showed.
“For the second year in a row, we will be the advanced economy number one in terms of GDP growth,” Spain’s Finance Minister Carlos Cuerpo told CNBC in April. 
“Spain is a great outlier now in terms of growth. It’s also a great place to invest,” he added.
The success of Spain’s economy relies on high consumption and investment, as well as tourism, Next Generation European funds, and immigration.
“It’s not just tourism, it’s also non-tourism services. We’re exporting more in terms of services to firms like IT, accountability services, financial services, than we’re exporting in terms of tourism — 100 billion euros [$116.8 billion] with respect to 94.95 billion [euros in tourism]. So that’s an element of modernization of the Spanish economy,” said Cuerpo.

Despite this economic growth, several challenges await Spain, such as keeping pay in line with the rising cost of living, climate change, an ever more divided political scene and the fact the country has the highest youth employment rate in the EU.
“What is going to happen with tariffs and international trade, especially in an economy like Spain, where exports of goods have increased considerably over the last 15 years?” said Cardoso.
“The second challenge is that the savings rates remains relatively high. A third source is this low investment rates. And finally, how to decrease the government deficit and public debt.”

Immigration and tourism boom

Still, tourism in Spain represents around 12% of the country’s GDP, as it benefits from the pandemic rebound, and cheaper prices compared to other Western European nations.
The sector’s success has sparked backlash from local communities over the influx of people visiting historic and popular sites, particularly during the peak summer months. Last year in June, protesters in Barcelona were seen spraying travellers with water guns and shouting “tourists go home.”
The sector can also count on its growing workforce of nearly 3 million people as of 2024, a progression of 9.7% compared to 2023.
Job creation is also supported by high immigration. While other European countries are closing their borders, Spain is planning to welcome nearly a million migrants over the next three years, through work visa schemes and the granting of residence permits to undocumented workers.

“90% of the increase in the labour force since 2021 comes from immigration,” BBVA Research’s Chief Economist Miguel Cardoso told CNBC.
“This is allowing the service sector to expand. This is keeping firms relatively competitive in terms of containing the increase in labour costs, and it’s allowing, for example, the prices in services to remain relatively contained in a high inflationary environment.”
Las year, most people migrating to Spain came from Colombia, Venezuela and Morocco.
“Latin American economies, some of them are not doing relatively well, so there is this push factor. There is also the fact that immigration to the United States has become more difficult, and therefore people are turning around and seeing alternatives,” added Cardoso.
Spain’s economy has also been bolstered by the European Union’s Next Generation EU funds which has made 163 billion euros available to Spain, through grants and loans. The country is the second biggest beneficiary of this pandemic recovery assistance, following Italy. 
Spain’s Cuerpo told CNBC that 70% of the grants — 55 billion euros — have already been dispersed.

“This was a program that was designed in part to try to help with the recovery after the pandemic,” said Cardoso.
“So the government prioritized investment projects that they already had a plan for, and therefore they are having a relatively low multiplying effect within the economy.”
Nonetheless, the Spanish government aims to use these funds in sectors such as non-tourism services exports, including renewables. 

Low energy costs

Since investing in green energy in the 2000s, Spain has benefited from low energy costs and has seen less impact from the European energy crisis that followed Russia’s invasion of Ukraine in 2022.
“The increase in the renewable share in the electricity mix over the past five, six years has implied a drop of 40% in wholesale electricity prices,” Cuerpo said. 
Low production costs are an attractive criterion for companies, particularly foreign investors, who also supply the sector.
Photovoltaics tracker company Arctech, founded in China in 2009, opened its European headquarters in Madrid in 2024. Photovoltaic cells convert sunlight directly into electricity. It’s a burgeoning renewable energy source that can lead to lower electricity costs.
“Spain is probably the location in Europe where the most PV has been done,” Arctech’s EU and NA Markets General Manager Pedro Magalhaes told CNBC.
“The solar ecosystem is really here [in Spain], from the junior engineer, all the way to the funds that are investing in these large assets.”
The company now boasts 17 branches outside China, and is planning to expand in Eastern Europe, as well as plans to diversify into storage solutions.
“Things are happening here. We use the port of Valencia to import and distribute to many locations in Europe,” Magalhaes added.

Like Arctech, many foreign companies are planning to take advantage of the country’s low energy costs.
Auto giant Stellantis teamed up with battery manufacturer CATL in late 2024, announcing plans to build a $4.3 billion lithium iron phosphate battery plant in Zaragoza, northeastern Spain.
Foreign direct investment in Spain is strong too, with the country ranking as the fourth most attractive country in the EU for investors. China alone declared it will be investing up to 11 billion euros in Spain in 2025, as it gears up for a record 33 new projects in the country. 
“When you look at where does that investment come from, the largest investor in Spain is U.S.,” said Cuerpo.
“But we’re also attracting investment from other parts of the world, including China, on specific sectors related to renewables, to sustainable mobility as well, and this is of course, always part of our economic security agenda.” More

Cocoa prices have eased from the record highs of late 2024, but a knock-on effect is still being passed through from chocolatiers onto consumers, according to analysts.
Poor weather and lower West African production pushed up cocoa futures, but supply is starting to increase again and could bring “some relief” to chocolate-lovers by next Easter, J.P. Morgan Strategist Tracey Allen told CNBC.
However, persistent U.K. retail price inflation and the impact of U.S. tariffs could put concurrent pressure on costs on both sides of the Atlantic.

Dubai pistachio kunafa chocolate bars are displayed in Maple, Ontario, Canada, on May 11, 2025.
Nurphoto | Nurphoto | Getty Images

Chocolate lovers face another run of price rises as a lag impact from the cocoa market hits retailers — but better news may be in store by next Easter.
Cocoa prices have soared in recent years, hitting record highs amid adverse weather conditions, pest outbreaks and supply tightness in West Africa, which produces around three-quarters of global supply.

That trend has combined with broader retail price inflation around the world which is pushing up costs for consumers and denting demand for sweet treats in the process. A 2024 survey by U.K. consumer group Which? found chocolate products were the category with the highest average annual inflation rate in grocery stores last year, at 11%. In the U.S., the price of popular products such as Hershey’s Kisses similarly jumped around 12% year-on-year.
Adalbert Lechner, head of Swiss giant Lindt & Sprüngli, told CNBC in April he doesn’t think cocoa prices “will ever come down to the levels where they have been before.”
Cocoa futures have remained choppy but overall eased this year, falling from $8,177 per metric ton at the start of January to around $7,855 in August. That compares with $2,374 three years ago.

And the recent decline won’t show up in chocolate prices in the near-term, according to Tracey Allen, agricultural commodities strategist at J.P. Morgan.
“We’ve got a bit of a hangover happening here,” Allen told CNBC’s “Squawk Box Europe” on Thursday.

Chocolatiers are still dealing with the heightened cocoa prices from the fourth quarter of 2024 when they saw record highs, she said.
“These heightened prices have really had this flow-on, lagged impact for the industry as a whole,” she said, with a higher cost of doing business being passed through to the consumer. “There is this ongoing deficit in the market, big depletion of availability of cocoa beans and availability of products. So higher prices for longer here, I’m afraid,” she continued.
Lydia Toth, spokesperson for the association of Swiss chocolate manufacturers Chocosuisse, said the quadrupling of cocoa prices over the past two years had significantly increased production costs, squeezing manufacturers’ margins, particularly given that retail prices tend to lag.
“The impact is being felt across the industry, from smaller businesses to large international exporters. While some of these cost increases have been passed on to consumers, further price adjustments remain likely. A return to earlier price levels is unlikely,” Toth told CNBC.
However, the outlook may be slightly brighter in time for the busy Easter season, J.P. Morgan’s Tracey Allen noted.
Industrial demand from manufacturers is softening just as supply is improving, with production ramping up, better weather conditions and new plantings in Ecuador and Brazil reaching maturity, according to J.P. Morgan analysis, though cocoa prices are seen remaining structurally higher for longer at $6,000 per metric ton.

Tariff hit

Hamad Hussain, climate and commodities economist at Capital Economics, told CNBC that longstanding productivity challenges such as diseases and years of underinvestment in Ivory Coast and Ghana – the world’s two largest cocoa producers – mean that global supply will remain tight, even if weather conditions in West Africa improve over the coming months.
“That will keep prices elevated at historically high levels. Historically high cocoa prices could support chocolate prices,” he said.
He also noted other factors that could push up costs on both sides of the Atlantic.
In the U.K., businesses face higher costs from hikes to the minimum wage and employee contributions, which Hussain said appeared to be feeding into the price of foodstuffs including chocolate.
Meanwhile, in the U.S. he said the impact of tariffs could add upward pressure to the price of chocolate over the coming months.
“The upshot is that consumers are likely to face high chocolate prices for some time,” he said.

Chocolate, skincare and timepieces: What 39% tariffs on Swiss goods mean for U.S. consumers

— CNBC’s Sam Meredith contributed to this story. More

Markets rallied following Indian Prime Minister Narendra Modi’s announcement of tax cuts set to boost domestic consumption.
India’s economy is battling with the challenge of prospectively steep U.S. tariffs exacerbated by its Russian crude purchases.
India’s autos industry could also emerge as one of the beneficiaries of the new tax policies.

Narendra Modi, India’s prime minister, during the nation’s Independence Day ceremony at Red Fort in New Delhi, India, on Friday, Aug. 15, 2025.
Bloomberg | Bloomberg | Getty Images

Indian markets rallied on Monday as Prime Minister Narendra Modi’s recently revealed tax cuts extended a gift to a domestic economy that still faces the teeth of U.S. tariffs.
The Nifty 50 index advanced 1%, with the BSE Sensex adding 0.84%. In currencies, the U.S. dollar surrendered 0.18% against the rupee.

In an extensive Independence Day speech on Friday, Prime Minister Narendra Modi made a concerted push for self-reliance and proposed a spate of financial reforms. New Delhi now plans a two-rate structure of 5% and 18% under wide-spanning changes to the goods and services tax (GST) regime, and plans to abolish the previous 12% and 28% levies imposed on some items, Reuters cited a government official as saying on Friday. The news was also reported by local media.
“The reforms aim to simplify compliance, lower tax rates, and modernise the GST framework to make it more growth-oriented. Industry executives expect measures such as rationalising rates into two slabs, easing the tax burden on micro, small and medium enterprises (MSMEs), cutting levies on essential goods, and using technology-driven processes like pre-filled returns and faster refunds to encourage investment,” the India Brand Equity Foundation said, adding that manufacturing, logistics, housing and consumer goods could stand to gain.
India’s autos industry could also emerge as one of the beneficiaries of the new tax policies after a sluggish stretch in recent months. Sales of India’s passenger vehicles, which include cars, added 4.2% percent in the 2024 calendar year, the Society of Indian Automobile Manufacturers said in January – the slowest growth pace in four years, according to Reuters.
Auto sector stocks saw increases during the Monday session, as Maruti Suzuki India adding 8.75%, while Hyundai Motor India rose by 8.15%.
“I’m certainly positive about the announcement, and the autos sector being a relative laggard in recent quarters, so not surprising to see that sector bounce back quite strongly,” James Thom, senior investment director on the Asian equities team at Aberdeen, told CNBC’s “Inside India on Monday.”

Modi’s tax overhaul could shore up India’s economy, which the Reserve Bank of India sees growing 6.5% in the 2025-2026 fiscal year, at a time of deep geopolitical uncertainty stoked by Washington’s sweeping so-called “reciprocal tariffs.” New Delhi in particular has fallen in the crosshairs of U.S. President Donald Trump’s administration over its ongoing purchases of Russian crude, with Washington imposing an additional 25% levy on Indian imports — bringing total duties to 50% — due to take effect at the end of this month.
“India is a domestic consumption story. Exports is a relatively small contributor. So this [tax overhaul] could more than offset that impact of tariffs,” Aberdeen’s Thom said.
“From a fundamental standpoint, absolutely, I think the changes to the GST regime will be supportive near-term for consumption as it comes through later in the year. And consumption has been weak in India for quite some time now, so this is a real sort of boost to the economy, if you like, given India’s economy is so dependent on domestic consumption.”
Domestic intake is “one of the most compelling indicators investors are closely monitoring,” and the “largest driver of economic growth in India,” with a 61.4% GDP contribution in the 2024-25 fiscal year, Deloitte said in an August report.
“Notably, urban consumption and a shift in spending preferences toward luxury goods are emerging as key pillars of this momentum,” it said.
India Ratings & Research meanwhile forecast India’s private final consumption rate in the fiscal year to the end of March 2026 will expand by an annual 6.9%, outpacing a broader 6.3% GDP growth outlook over the period, on the back of low real wage increases, declines in household savings and a boost to personal loans.
“A sharp decline in inflation has improved the prospects for stable consumption growth in FY26,” it added. India’s retail inflation has slowed from 4.31% in January to its lowest since 2017 at 1.55% in July. More

Wall Street veteran David Zervos added his name Thursday to the list of potential Federal Reserve chairs who think the central bank is past due in approving an interest rate reduction.
For the past three Fed meetings, Zervos has advocated a half percentage point cut in the federal funds rate, and he repeated that position during a CNBC interview.

Wall Street veteran David Zervos added his name Thursday to the list of potential Federal Reserve chairs who think the central bank is past due in approving an interest rate reduction.
The chief market strategist at Jefferies told CNBC that central bankers shouldn’t be daunted by the July producer price index showing pipeline inflation pressures hotter than expected.

Instead, he advocated the Fed move aggressively now to ease as a way to forestall a labor market slowdown and in fact help create a million more jobs. For the past three Fed meetings, Zervos has advocated a half percentage point cut in the federal funds rate, and he repeated that position during an interview.
“I’m still absolutely there. I think there is a reasonable storyline, a very cogent storyline, that suggests monetary policy is restrictive,” he said. “Generally speaking, I don’t see any reason why this [PPI] number changes that view.”
A process that had included just three or four names to succeed Fed Chair Jerome Powell when his term expires next year has expanded in recent days to nearly a dozen.
Zervos joins a list that includes current and past Fed officials, at least one Trump administration advisor and multiple other noted Wall Street economists. Of the group, Zervos and BlackRock bond strategist Rick Rieder are the only ones whose background is more concentrated on markets than economics.
“I think it would be an incredible benefit to have more market-savvy, more market-competent people involved in the monetary policy decision,” Zervos said.

Earlier in the day, economist Marc Sumerlin, also on the list of finalists, backed a half-point cut as well and said the Fed has been too conservative in fighting the inflation battle.
President Donald Trump has pushed hard for the Fed to cut, lashing out repeatedly at Powell and suggesting that the Federal Open Market Committee should slash as much as 3 percentage points, or 300 basis points, off the funds rate, which is currently around 4.33%.
“I don’t know that I could get all the way to 300, but I certainly could get to 200 and I could be convinced on lower than that if you really push the AI story and the technology story and the idea that we have disinflationary pressures building from a supply-side narrative,” Zervos said.
Zervos added that he is not deterred by the types of criticism Trump has leveled at the Fed.
“You go into that job fully understanding that you’re involved in the political process,” he said. “The goal is to have the debate be driven by facts and be driven by what is best for achieving the mandates that Congress sets out.”

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Wholesale prices rose far more than expected in July, providing a potential sign that inflation is still a threat to the U.S. economy, a Bureau of Labor Statistics report Thursday showed.
The producer price index, which measures final demand goods and services prices, jumped 0.9% on the month, compared to the Dow Jones estimate for a 0.2% gain. It was the biggest monthly gain since June 2022.

Excluding food and energy prices, core PPI rose 0.9% against the forecast for 0.3%. Excluding food, energy and trade services, the index was up 0.6%, the biggest gain since March 2022.

On an annual basis, headline PPI increased 3.3%, the biggest 12-month move since February and well above the Fed’s 2% inflation target.
Services inflation provided much of the push higher, moving 1.1% higher in July for the largest gain also since March 2022. Trade services margins rose 2%, coming amid ongoing developments in President Donald Trump’s tariff implementations.
In addition, 30% of the increase in services came from a 3.8% increase in machinery and equipment wholesaling. Also, portfolio management fees surged 5.8% and airline passenger services prices rose 1%.

Stock market futures fell following the release, while shorter-duration Treasury yields moved higher.

Though PPI is followed less closely than the BLS’ consumer price index, it provides important information on pipeline prices. Together, the measures feed into the Commerce Department’s personal consumption expenditures price index, the Fed’s primary inflation forecasting gauge, which will be updated later this month.
With CPI coming in right around expectations earlier this week, markets had been pricing a virtual certainty that the Fed will lower its key interest rate when it meets next in September. Following the release, odds of a September cut decreased but only slightly, according to the CME Group’s FedWatch.
“The large spike in the Producer Price Index this morning shows inflation is coursing through the economy, even if it hasn’t been felt by consumers yet,” wrote Chris Zaccarelli, chief investment officer at Northlight Asset Management. “Given how benign the CPI numbers were on Tuesday, this is a most unwelcome surprise to the upside and is likely to unwind some of the optimism of a ‘guaranteed’ rate cut next month.
The reports come amid escalating questions over BLS data accuracy.
Trump earlier this month fired the former BLS commissioner and said he intends to nominate Heritage Foundation economist E.J. Antoni as the next head of the bureau. Antoni has been a critic of the BLS and even has floated the idea of suspending the monthly nonfarm payrolls report until data accuracy can be better insured.
The BLS has been hamstrung by budget cuts and layoffs that have forced it to alter the way it collects data. July’s PPI report was the first since the bureau eliminated some 350 categories from the exhaustive count of input costs. More

Economist Marc Sumerlin, one of nearly a dozen reported contenders for Fed chair, said Thursday he’d be interested in the job and believes an aggressive interest rate cut would be appropriate.
“We could easily do a 50 basis point cut … without disrupting anything at all. So it seems like pretty much a no-brainer to me,” Sumerlin said on CNBC.
He stressed the importance of Fed independence, something that has come under question this year.

Economist Marc Sumerlin, one of nearly a dozen reported contenders for Federal Reserve chair, said Thursday he’d be interested in the job and believes an aggressive interest rate cut would be appropriate.
Sumerlin, a former senior economist under then-President George W. Bush, said on CNBC that lowering the Fed’s key rate would be an easy decision now.

The current yield structure combined with weakness in the labor market and stable inflation “tells us that we could easily do a 50 basis point cut … without disrupting anything at all. So it seems like pretty much a no-brainer to me.” A basis point equals 0.01%, so 50 basis points would be half a percentage point.
With the field looking wide open to succeed current Chair Jerome Powell, Sumerlin’s position on rates puts him at least directionally in line with President Donald Trump. The president has repeatedly pushed the Fed to ease, advocating cuts of up to 3 percentage points, but the Powell-led Federal Open Market Committee has kept is benchmark funds rate unchanged since last lowering in December 2024.
As far as the nomination sweepstakes goes, Sumerlin, currently managing partner for Evenflow Macro, confirmed that he was contacted by the White House last week. He noted that he is close friends with Treasury Secretary Scott Bessent, who has taken a leading role in the search for the next chair, saying the two have been discussing monetary policy “weekly for probably 12 years.”
“I got a call last Wednesday that said there was going to be a list [and] I was going to be on it. That’s as much as I know right now,” he said. “I’m waiting for more guidance on where we go from here.”
Sumerlin indicated that he would be interested in the nomination so long as certain conditions are met.

“I think if it’s the Fed chair, it’s mission critical to the world. You have to be willing to do that,” he said. “I’ve never met the president before. It would depend on us seeing eye to eye.”
Sumerlin stressed the importance of Fed independence, something that has come under question has Trump has taken the historically unprecedented step of criticizing Powell and his fellow policymakers publicly and in stark terms. He’s called Powell a “loser” and “stupid” and has criticized the FOMC for being complacent.
“You have to go into it knowing that every day you’re going to walk in and just do the best job you can for the American people, and you’re going to get criticism and be prepared to deal with that,” Sumerlin said. “Ideally, you’d want to go in knowing that you’re in synch. In synch goes both ways, and that would be part of the process trying to figure it out.”
In addition to Sumerlin, other candidates include current governors Michelle Bowman and Christopher Waller, National Economic Council Director Kevin Hassett and former Governor Kevin Warsh, along with about half a dozen others. More