PPI Hits 27 Year High
By: Ariel Nelson | Director of Market Data & Content Services, CBNC
The growth of the Producer Price Index is now at levels not seen since 1981. The PPI numbers came in this morning up 1.2% for the month, double expectations and after a 1.8% rise in June. On a year-over-year basis, inflation is up nearly 9.8%, a 27 year high. Less volatile food and energy costs, the PPI still rose 3.6% on a year-over-year basis.
Here is a breakdown of the inflation benchmark to show you where costs are rising most. The biggest increases for producers is on the raw material side, with energy up nearly 85% from one year ago. Keep in mind the July numbers do not fully reflect the recent drop in energy prices. We should see better numbers next month.
The worse than expected economic news was weighing heavily on the futures before the open. Leading the Dow to the downside are the financials including AIG, American Express , Bank of America , JP Morgan Chase , and Citigroup.
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