- Highest since March 2023
- Prior was +2.2% y/y
- PPI final demand +0.2% m/m vs +0.1% expected
- Prior was -0.2% (revised to 0.0%)
- PPI ex food/energy +3.0% vs +2.5% y/y expected
- Prior ex food/energy revised to 2.6% from 2.3%
- PPI ex food/energy +0.4% vs +0.2% m/m expected
- Prior ex food/energy +0.0% (revised to +0.3%)
- Full release
Well this is a curveball. Had it come before CPI, this would have led to some real angst but now the market is left scratching its head about where inflation is landing. There is some pipeline pressure here but in the CPI numbers, we should get a year of housing disinflation. What’s the signal and what’s the noise?
Note that the prior numbers were also revised notably higher.
There is also this:
"The June rise in the index for final demand can be traced to a 0.6-percent increase in prices for final demand services. In contrast, the index for final demand goods decreased 0.5 percent.
For now, Fed funds pricing ticked 1 bps lower to 60 bps. The dollar initially rallied but has given most of it back.”
Does that sound like some kind of one-off quirk?