After yesterday’s hotter than expected rebound in CPI, all eyes are on PPI for signs that the pipeline for inflation may be more dove-friendly.
It wasn’t!
Producer Prices rose 0.7% MoM in August (up from +0.3% in July and hotter than the +0.4% exp). That is the hottest PPI since June 2022, and pushed YoY prices up 1.6%…
Source: Bloomberg
Goods prices are reaccelerating fast, now back into inflation YoY (as Services cost growth slowed only modestly)…
Source: Bloomberg
As a reminder, much of last month’s PPI rise was driven by a big jump in portfolio management costs – as stocks soared. August saw a further rise in those costs…
Source: Bloomberg
More problematically, the pipeline for PPI appears to have inflected as intermediate demand is re-accelerating…
Source: Bloomberg
This is not what The Fed wanted to hear.
Tyler Durden
Thu, 09/14/2023 – 08:53
