Don’t sleep on today’s US PPI report

In general, traders can ignore monthly PPI data most of the time. It’s a loud read on pipeline inflation and doesn’t always feed through to the CPI in easy to predict ways.

This is currently not the case. Last month’s reading on PPI caused the biggest movement I’ve seen on the release and it was released after CPI. Usually it’s more of a factor when released ahead of the CPI and it is this month.

Notably, the big move after last month’s report then faded, so it’s a good bet to be the playbook again if there’s a big move in the market. The consensus is +7.2% y/y on the stock and +5.9% y/y excluding food and energy.

The figures came out at the end of the hour.


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