09/12/2022
November PPI
Highlights
The Producer Price Index for final demand increased 0.3% month-over-month in November (Briefing.com consensus +0.2%) following an upwardly revised 0.3% increase (from 0.2%) in October.
The index for final demand, less foods and energy, increased 0.4% month-over-month (Briefing.com consensus +0.2%) following an upwardly revised 0.1% increase (from 0.0%) in October.
On a year-over-year basis, the index for final demand was up 7.4%, versus 8.1% in October, and the index for final demand, less foods and energy, was up 6.2%, versus 6.8% in October.
Key Factors
The index for final demand goods increased 0.1% month-over-month, paced by a 3.3% increase in prices for final demand foods.
The index for final demand services jumped 0.4% month-over-month, led by a 0.4% increase in prices for final demand services less trade, transportation, and warehousing.
Prices for processed goods for intermediate demand moved down 0.9% month-over-month, which was the fifth consecutive decline.
Prices for unprocessed goods for intermediate demand fell 3.2% month-over-month, driven by a 7.8% decline in prices for unprocessed energy materials.
Big Picture
The key takeaway from the report is that it will pique concerns about the Consumer Price Index not being as friendly as expected either, which in turn will keep the market on edge about the Fed's monetary policy path. Beyond that consideration, it is good nonetheless to see the year-over-year change in PPI and core PPI moving lower, although the current levels are still far too high.
