May 12, 2022 | 08:51
U.S. Producer Prices .... More Proof Please
Remember what Fed Chair Powell and the Cleveland Fed's Mester said recently about inflation possibly peaking or flattening out .... they want to get "more than just some evidence", or see some "compelling moves", before they can breathe a little. The April CPI report gave a tiny glimpse but it wasn't enough (obviously, judging by the market's reaction yesterday). The April PPI report didn't make things worse... so that is a good thing.
U.S. producer prices rose 0.5% in April, as expected and the smallest monthly increase in over half a year. And, compare that to the monthly average of about 0.9% since the start of 2021. There was a 1.5% rise in goods prices, no change in services, and a 4% jump in construction (most in 3 months). From a year ago, well, 11.0% is still staggering high but at least it is a pullback from the 11.5% surge in March, which was the highest since records began all the way back in 2010.
Ex. food & energy, prices rose 0.4%, below expected and more than half of March's 1.2% jump and 8.8% y/y. Ex. food & energy & trade, prices rose 0.6% or 6.9% y/y.
Look at the charts ... still need a lot more evidence needed before we can declare that inflation has peaked. But at least there's been one step.