PPI: 2.4% YOY Through November, Core PPI 1.2% YOY. Inflation Concerns Return.

The US Producer Price Index, which measures inflation at the business and manufacturing levels of the economy, was 1.8% in November and 2.4% year-over-year through November. Excluding volatile oil and food costs from the readings, “Core” PPI for November was 0.5% and 1.2% YOY through November. You can view and download historical PPI data by scrolling down to our Data section on the right side of the site.

These numbers were higher than expected. By clicking on the Monthly ‘All’ and ‘Core’ PPI reports in our Data section, it will display a chart atop that section where you will see this see-saw very evident. On surface level, market sentiment seems to be that inflation shouldn’t be an issue for some time because aggregate demand is compromised by weakened consumers and businesses, but today’s report causes markets to question that, and bonds trade wildly as inflation expectations are reconciled. All this month’s measures of PPI close to the Fed’s 1-2% comfort zone for inflation, but since they exceeded expectations, bonds are worst and rates are higher.