Peter Smith
⬤ The newest Producer Price Index numbers showed two opposite stories. The overall index rose to 2.7 percent, above the 2.6 percent that analysts expected. The core index which leaves out items that swing wildly, slipped to 2.6 percent, below the 2.7 percent forecast. The split shows that cost pressures vary from one category to another.
⬤ The headline number moves sharply when energy and commodity prices jump or fall - its gain fits that pattern. The core number eased, which signals that steadier production costs are losing speed. The gap proves that inflation does not move in step - certain sectors cool while others stay hot.
The result gives a mixed report on underlying price trends.
⬤ Those clashing readings carry weight because they steer how economists and policymakers judge the current inflation push. The figures show that price pressure shifts unevenly across industries leaving a tangled scene for short term economic choices.
Peter Smith
