The number:

1.6% increase in headline PPI is super hot.

But core (ex-food and energy) at 0.2% is super-tame.

So the debate of headline vs. core remains.

Background: Well, this is going to surprise nobody but producer pices are getting more expensive. The official estimate is for a 0.6% rise in producer prices.

The real question is: how will tomorrow’s CPI match up, and what does that tell you about margin pressure.

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