Wholesale PPI up .8% in January

WABAC

CNBC reports:

The core PPI, which excludes volatile food and energy prices, increased a seasonally adjusted 0.8%, more than the 0.6% gain in December and well ahead of the Dow Jones consensus estimate for 0.3%.

On an all-items basis, headline PPI rose 0.5%, also above the forecast for 0.3% and 0.1 percentage point more than the prior month.

For the full year, core wholesale prices accelerated 3.6%, while the headline index posted a 2.9% gain.

DrVenture

Thanks @WABAC

I was about to post this. This is as expected, by many people, who know that tariffs on corporations and consumers are inflationary. Wholesale 3.6% PPI YOY is a LOT.

The expectation for 2026 is that companies will be passing on price increases, more and more. All the pre-tariff warehoused goods are exhausted.

yogibearbull

Wholesale PPI leads retail CPI, so high PPI reading isn't a good sign of what may soon be happen to CPI.

DrVenture

Good point. Nearly everybody thought the January CPI print was probably hinky. Some were grasping at it a little too desperately. If something appears too good to be true...

equalizer

Services prices primarily drove the increase, with a 0.8% monthly rise that was the highest since July 2025. By contrast, goods prices actually fell 0.3%, though core goods prices climbed 0.7%.

So if you don’t need overpriced services and rely on all goods instead of overpriced core goods, PPI actually went down. CNBC won’t tell you that.

DrVenture

Thanks for additional granularity. And I appreciate the optimism.

Still, could it be a little more complex than that? Higher services are still a drag on the overall economy. Affecting many income levels. Services includes healthcare, rent, transportation and dining. Core goods includes cars, electronics, clothing. Again hitting several income levels.

Supposing that dining cost rises enough to slow dining outside the home, that hurts restaurants. And it hurts those who work at restaurants. And those who own restaurant stocks.

No argument that one might skip/avoid/replace certain items, which could lower personal inflation. But, the economy as a whole still is impacted when the consumer avoids spending. I tend to look at inflation alongside GDP, jobs and the markets. I am much less worried about my personal inflation, than a potential hit to my portfolio.

With 2025 GDP trending lower and jobs flat, and U.S. markets struggling, higher inflation could mean stagflation on the near horizon.

Crash

With 2025 GDP lower and jobs flat, and U.S. markets struggling, higher inflation could mean stagflation on the near horizon.

Oh, Joy! Oh, Rapture!
--Scarecrow, Wizard of Oz.