Producer Price Inflation (PPI)
-
PPI inflation (m/m): actual 0,4% (forecast 0,4%, previous 0.1%)
-
Core PPI inflation (m/m): actual 0.2% (forecast 0.3%, previous 0.3%)
-
PPI inflation (y/y): actual 5,4% (forecast 5.3%, previous 4.8%)
-
Core PPI inflation (y/y): actual 4.6% (forecast 4.6%, previous 4,3%)
Why is this data important?
Producer Price Inflation (PPI) measures changes in the prices of goods at the producer level, before they reach consumers. It is one of the key leading indicators of consumer inflation (CPI), as rising production costs are often passed on to end consumers.
An increase in PPI suggests rising cost pressure in the economy, which may lead to higher inflation in the future. On the other hand, a weaker reading indicates lower price pressure and may give the central bank more room for a more accommodative monetary policy. Core PPI is particularly important, as it excludes volatile components such as energy and food, providing a more stable view of underlying price trends.
This report has a significant impact on financial markets. A stronger than expected rise in PPI can support the US dollar and push bond yields higher due to expectations of higher interest rates, while weaker data may have the opposite effect.
Current Data
US producer inflation remained elevated in August, supporting expectations for a more hawkish Federal Reserve.
PPI rose 0.4% m/m, in line with expectations and up from 0.1% previously. Core PPI increased 0.2% m/m, below the 0.3% forecast.
On a yearly basis, PPI accelerated to 5.4%, above expectations of 5.3% and up sharply from 4.8%. Core PPI rose to 4.6% y/y, matching expectations but increasing from 4.3% previously. The previous figures were also revised.
Overall, the report points to persistent inflationary pressure, particularly in annual terms. This strengthens expectations that the Fed may need to keep rates higher for longer or potentially raise rates, supporting the US dollar while weighing on equities.
Source: xStation5
ECB won’t commit to future hikes, which weighs on the euro
LIVE: ECB Conference
ECB Hikes to 2,5% 💶
Time for an ECB rate hike
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.