On October 11, the United States released the September Producer Price Index (PPI) report. The data showed that PPI was flat month-on-month, which was a gap compared with the market's expected 0.1% growth. Year-on-year, PPI rose 1.8%, slightly higher than analysts' expectations of 1.6%. Core PPI rose 0.2% month-on-month, in line with market expectations, while year-on-year growth was 2.8%, exceeding the expected 2.7%.

Although yesterday's Consumer Price Index (CPI) report showed an increase in core inflation, the producer price data may surprise the market. Affected by the PPI data, U.S. Treasury yields fell. The 2-year Treasury yield fell back to 3.96%, and the 10-year Treasury yield fell to 4.09%.

With the release of the PPI report, the U.S. dollar index tried to break below the 102.80 mark. As the month-on-month increase in PPI was lower than expected, the U.S. dollar was under pressure and weakened. Against the backdrop of the dollar's pullback, gold prices rose to around $2,650, and investors showed more attention to the weakness of the dollar.

The S&P 500 climbed to 5,790 points, and the market expected that inflation may be slowing down. The Nasdaq closed above 20,200 points, and the Dow Jones tested the 42,500 level.

Despite the initial positive market reaction, the sustainability of the market trend remains to be seen as both PPI and core PPI year-on-year growth exceeded expectations.