US PPI Rises 3% in December, Above Market Expectations
The US Producer Price Index (PPI) rose 3% in December compared to a year earlier (YoY), according to the latest data from the Bureau of Labor Statistics (BLS). This figure was higher than the market forecast of 2.7% and matched the 3% increase in the previous month.
Excluding the food and energy components, the core PPI rose 3.3% (YoY). This result also exceeded the 2.9% projection and increased from 3% in the previous period, signaling that price pressures at the producer level remain quite strong.
On a monthly basis (MoM), the headline PPI rose 0.5%, while the core PPI increased 0.7%. These monthly increases indicate that price pressures from the "upstream" side of the economy have not fully subsided and could potentially impact consumer inflation if production costs are passed on to selling prices.
The market responded with a strengthening US dollar on Friday, approaching a two-day high around 96.60, as investors digested the release of the producer inflation data and news of Kevin Warsh's nomination as the next Fed Chair. The combination of hotter data and central bank leadership dynamics could maintain volatility in the bond, dollar, and risk asset markets in the near term.
Source: Newsmaker.id
