US PPI preview - Nomura

The Research Team at Nomura provides key insights on what to expect from today’s US PPI data due to be reported at 1330GMT.

Key Quotes:

The headline is expected at +0.2% m/m versus prior +0.4%.

“Topline producer prices rose 0.4% m-o-m in November, driven by a strong increase in energy prices.

Excluding volatile food, energy and trade (wholesalers' margin), producer prices were up 0.4%.

Pipeline pressure on consumer prices appears to be modest.

The inflation of PPI for intermediate goods has been accelerating, in line with steady upward pressure on input prices. However, the prices of finished goods and consumer goods have not responded strongly.

Elsewhere, service prices which make up a large share of the PPI rose modestly by 0.2%.

We expect service prices to continue rising at a steady pace.

As spikes in energy prices caused by the hurricanes revert, aggregate PPI inflation will likely return to its previous trend in December. Excluding food, energy and trade components, we expect modest PPI inflation. Note that our December CPI forecasts may be subject to revisions based on the December import prices and PPI data.”