Federal Reserve official meeting announcement

US December PPI Up 0.2%, Core PPI Unchanged, Both Below Expectations

Jan 14, 2025, 01:31 PM

US Producer Price Index (PPI) data for December showed inflation rising less than expected, indicating easing inflationary pressures in the economy. The PPI increased by 0.2% month-over-month, below the forecasted 0.4%, and core PPI remained unchanged, missing the expected 0.3% increase and marking the lowest monthly gain since July. On a year-over-year basis, PPI rose 3.3%, compared to the forecasted 3.5%, while core PPI increased 3.5%, below the expected 3.8%. The lower-than-expected PPI figures reflect slower wholesale price increases, with goods prices up 0.6% and services prices unchanged. Notably, energy prices climbed 3.5%, driven by a 9.7% surge in gasoline prices. Following the release, equity futures rallied, and Treasury yields dipped as markets reacted positively to the possibility of moderated inflation. The data precedes the Consumer Price Index report due tomorrow, which will further inform expectations about inflation and Federal Reserve policy.