U.S. PPI data for September came in pretty hot, with inflationary pressure at the producer level rebounding.
First, let's distinguish the two: PPI measures the costs factories pay for inputs and production—in other words, inflation at the producer level. CPI measures the prices consumers pay for goods. PPI typically leads CPI: when factory costs rise sharply, businesses are likely to pass those increases on to retail prices, pushing CPI higher.
In September, PPI rose 1.3% month over month, versus expectations of 0.5%. Core PPI rose 0.7%, versus expectations of 0.3%. Both came in far above forecasts.
With prices rising for a second consecutive month, and CPI also coming in above expectations the night before, inflation is picking up across both upstream and downstream sectors—not just experiencing a temporary rebound.#CPI #PPI
First, let's distinguish the two: PPI measures the costs factories pay for inputs and production—in other words, inflation at the producer level. CPI measures the prices consumers pay for goods. PPI typically leads CPI: when factory costs rise sharply, businesses are likely to pass those increases on to retail prices, pushing CPI higher.
In September, PPI rose 1.3% month over month, versus expectations of 0.5%. Core PPI rose 0.7%, versus expectations of 0.3%. Both came in far above forecasts.
With prices rising for a second consecutive month, and CPI also coming in above expectations the night before, inflation is picking up across both upstream and downstream sectors—not just experiencing a temporary rebound.#CPI #PPI