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.