US PPI: Upward trend to continue with input costs rising - Wells Fargo

According to analysts from Wells Fargo, the upward trend in core producer prices is expected to continue as input costs picked up last month. 

Key Quotes: 

“Producer prices rose 0.2 percent in February amid another strong month for services inflation. Goods prices edged down despite another increase in non-food/energy products. Ex-food, energy and trade services (measured as margins), producer prices rose ahead of expectations and advanced 0.4 percent. On a year-ago basis, the “core-core” is up 2.7 percent compared to 1.8 percent last February.”

“Healthcare services ticked up and, on a year-ago basis, have risen by the most since 2013. The pickup indicates healthcare will provide a lift to the Fed’s closely watched PCE deflator.”

“Input cost growth for goods and services quickened in February. Higher prices for intermediate products suggest producer prices will continue to move up in the coming months, although the pace points to pressures remaining manageable in the near term.”

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