Producer Price Index (PPI) inflation data for May, to be released on Wednesday, June 14, will set the stage for the highly anticipated Federal Reserve meeting where interest rates will be determined.

The market’s expectations of the Fed’s rate hikes coming to an end were solidified after Tuesday’s CPI report revealed a lower-than-expected decline in consumer inflation.

The upcoming producer inflation data could provide additional evidence of a disinflationary trend, potentially swaying Fed members to reconsider the need for future interest rate increases.

Producer Price Inflation Preview: What Do Economists Expect?

Chart: PPI Inflation Is Falling Off A Cliff

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Commodity Prices Tumbled in May, Putting Additional Downside Pressure To PPI: 5 Commodity ETFs To Watch

Global commodities prices fell across the board in May, as COVID-19-related supply chain disruption further vanished and China’s economic recovery moved slower than expected.

The iShares S&P GSCI Commodity-Indexed Trust (NYSE:GSG), an exchange-traded fund that provides broad exposure to a diversified basket of commodities, including energy, agriculture, industrial metals and precious metals, fell nearly 4% in May. GSG is 6% down year-to-date.

The Invesco DB Agriculture Fund (NYSE:DBA), an exchange-traded fund that invests in a basket of agricultural commodities such as corn, wheat, soybeans and sugar, eased 2.3% last month. DBA is 7% higher year-to-date

The United States Oil Fund (NYSE:USO), the largest exchange-traded fund investing in contracts on WTI crude oil and other oil-related derivatives, plummeted more than 10% last month. USO is 8.3% lower year to date.

The Invesco DB Base Metals Fund (NYSE:DBB), an exchange-traded fund that invests in a basket of industrial metals like copper, zinc, nickel, tin and aluminum, tumbled 7% last month. DBB is 5.9% weaker year to date.

The Aberdeen Physical Precious Metals Basket Shares ETF (NYSE:GLTR), which provides investors with exposure to a basket of precious metals, also fell 3.5% last month. GLTR is 0.9% up year-to-date.

Other than physical commodities, sharp declines in freight costs were also observed in May, with the Baltic Dry Index, widely regarded as the most popular global shipping costs index, plummeting 39%.

Chart: Commodity ETFs’ Year-to-Date Performance

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