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U.S. September PPI is projected to rise by 0.6%, diesel prices are forecast to surge more than 70% year-on-year, and inflationary pass-through pressures have not yet abated.

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The U.S. September Producer Price Index (PPI) will be released at 20:30 Beijing time on October 15. U.S. diesel prices rose 24% month-on-month and 77% year-on-year in August, according to data from the American Automobile Association (AAA). Retail diesel prices hit a record high of $6.528 per gallon on September 22, and stood at $6.30 as of Wednesday, up more than 70% from the same period last year. Oxford Economics forecasts U.S. September PPI will rise 0.6% month-on-month, exceeding the market consensus of 0.5% and the 0.4% reading in August. Analysts note that diesel is a key input for road freight, rail transport and agricultural production; its price hikes will first push up corporate production and transportation costs, then gradually pass through to consumers via fuel surcharges, transport contracts and retail pricing. Even if diesel prices stop rising, cost pass-through may still lag, meaning inflationary pressures have not fully materialized. The Trump administration has taken steps to ease fuel supply strains, including temporarily relaxing some agricultural fuel use restrictions, and claimed Russia will supply diesel to the global market. However, industry insiders believe these measures will not resolve refinery capacity and finished product supply bottlenecks in the short term. Markets will watch whether this PPI data further confirms that the energy cost shock is spreading to corporate-level prices.

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