đșđž The producer price index for September came in at +1.3% compared to August âexpectations had been for +0.5%. This is the sharpest monthly increase since March 2022. Year-over-year, the increase is +6.3%, the highest figure since December 2022.
The boost comes primarily from energy:
- Goods: +2.6% for the month, the sharpest increase since the index began in December 2009
- Gasoline: +20.3% for the month
- Services: +0.8% month-over-month
But that doesnât fully explain it. The core rate excluding food, energy, and retail servicesâthat is, excluding the most volatile itemsârose 0.5% MoM and 5.0% year-over-year .
That same morning, the Department of Commerce reported retail sales of $745.0 billion. That is +0.8% compared to the expected +0.3%; the August figure was revised downward from +1.1 to +1.3% . These figures are not price-adjusted: excluding cars and gas stations, the increase was only 0.2%.
What does this mean for the stock market?
Producer prices are factored into the PCE Index , the Fedâs measure of inflation. Following this announcement, the probability of an interest rate hike on October 28 has risen from ~22% to about ~35% .
https://www.bls.gov/news.release/archives/ppi_10152026.htm