Worth watching: September's producer price data is starting to show interesting patterns in the components that matter most for the Fed's inflation gauge.
The PPI numbers that actually feed into PCE—the measure Powell and team obsess over—are telling a story. Not the headline noise everyone trades on, but the underlying inputs that shape policy decisions.
This is how inflation signals travel through the system. Producer costs today become consumer prices tomorrow. The lag matters. The composition matters more than most realize.
We're not out of the woods, but we're also not in the same forest we were 18 months ago.
The PPI numbers that actually feed into PCE—the measure Powell and team obsess over—are telling a story. Not the headline noise everyone trades on, but the underlying inputs that shape policy decisions.
This is how inflation signals travel through the system. Producer costs today become consumer prices tomorrow. The lag matters. The composition matters more than most realize.
We're not out of the woods, but we're also not in the same forest we were 18 months ago.