The Producer Price Index (PPI) measures inflation upstream from consumers, and its key headline and core numbers both made their largest advances since June and March 2022, respectively, according to new data released on Thursday morning.
Per the Bureau of Labor Statistics, headline PPI inflation jumped 0.7 percent in January, bringing the annual advance to 6.0 percent.
Estimates predicted that monthly headline PPI would only increase 0.4 percent, but the number released on Thursday blew past that expectation to record the largest monthly increase since last June’s 0.9 percent increase.
Biggest month-on-month increase since June. #PPI
— Carl Quintanilla (@carlquintanilla) February 16, 2023
Notably, the January increase for headline PPI more than wiped out any “progress” lowering costs President Joe Biden may have touted last year when PPI showed decreases of -0.2 percent in December 2022 and -0.3 percent last July.
Core PPI inflation — which excludes food, energy, and trade services — jumped 0.6 percent in January, that data point’s largest increase since it advanced 0.9 percent in March of 2022.
Thursday’s data is another move in the wrong direction when it comes to Americans’ hope that chronically high prices might ease in a noticeable way. But PPI, paired with the Consumer Price Index (CPI) release earlier this week, both showed inflation burning hotter than expected.
It also adds to fears that the Federal Reserve will continue hiking interest rates through 2023, as seen in Wall Street’s tumble in response to the latest PPI data on Thursday.