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Fed Rate Hike Odds Rise After Hotter-Than-Expected Producer Price Data
While still well below Fed mandated levels, the 0.9% year-over-year rise in PPI Final Demand ex Food & Energy is the hottest since March and notably above expectations. While the headline PPI Final Demand YoY has not risen for 8 months, surging prices for chicken eggs (+23%) and apparel (+7%) in August made up a considerable part of the inflation index move and bond yields and stocks are leaking lower on the news ahead of next week's FOMC meeting.
The key drivers from the report:
Almost half of the August advance in the index for final demand services is attributable to margins for apparel, footwear, and accessories retailing, which jumped 7.0 percent. The indexes for automotive fuels and lubricants retailing; securities brokerage, dealing, investment advice, and related services; wireless telecommunication services; residential real estate loans (partial); and inpatient care also moved higher. In contrast, prices for airline passenger services declined 1.6 percent. The indexes for machinery and equipment wholesaling and guestroom rental also fell.
Accounting for nearly two-thirds of the decline in the final demand goods index, prices for gasoline fell 7.7 percent. The indexes for jet fuel, grains, iron and steel scrap, home heating oil, and light motor trucks also moved lower. In contrast, the index for chicken eggs surged 23.2 percent. Prices for residential natural gas and for search, detection, navigation, and guidance systems and equipment also increased.
PPI has now beaten expectations for 3 months in a row and stands at 6 month highs:
And the breakdown:
With wholesale inflation starting to creep up, is the fate of the Fed's "most expected announcement ever" all but assured?
* * *
September rate hike odds have risen from 25% to 28% since PPI printed (and bond yields, stocks, and the dollar are sliding).
And while stocks have done nothing in the wake of the report, there has been an ominous move higher in Treasury prices:
- UST 10Y YIELD EXTENDS DROP, TOUCHES 2.188%
- TREASURIES EXTEND GAINS; 30Y YIELD TOUCHES 2.936%
Remember: if the Fed hikes, the only thing that matters is the long-end: if yields drop, it means the market is convinced the Fed just engaged in a massive policy error, and curve inversion and a recession may be imminent.
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Please raise rates and slow down this runaway freight train of an economy.....Morons
no rate hike but the silly rate hike?-game will drag on
Rate Hike Odds Rise
Double freakin dog dare you.
Yes!!! Full faith and credit motherfuckers!!!
Rate hike + QE
The below article is the best explination on how they will accomplish both that I've read.
http://davidstockmanscontracorner.com/fed-hike-now-or-never/
WHAT I SAID!
Fuck this lie! How many more times do we hear this horseshit. Raise rates today Mr. Yellen go ahead we dare you! Fake statistics will not keep this phony boat floating. It suceeds only to manipulate Gold and Silver which is also failing on you dogs, just look at the Registered Bullion at the Comex!
PPI has now beaten expectations for 3 months in a row and stands at 6 month highs...
LOL
wake me up when we have 10% inflation in things we need..................oh wait!
Are we approaching escape velocity yet??
Are we approaching escape velocity yet??
94 Americans out of work....we're getting there.
is that a chart of ppi or faz? /s
who cares? /s
maybe it's upside down? /s
I seriously doubt that the un-fed will raise rates.
However if they did raise them the piddly ass .025% the world will not catch on fire.
It already is!
If they raise rates does that mean I'll get moar then 0.01% yield in my savings acct?
Whooopieeeeee!
I can splurge and upgrade to the "Premium" dog food section.
Meh, Merikuns will always find a way to pay $200+ over priced slave labor made shoes.
That's only people on welfare....I don't have $200+ shoes.
I'm returning my slave labor shoes because they are so f'ing cheap they ripped out after 6 months. Full refund never buying puma again. Cheap chinese made crapp
Ooh stop it!!
The rate hike threat is SOOOOOOO STALE. The world has got to move away from the dollar and set up barter or something similar.
With the exception of a massive decrease in the human population, there has never been significant deflation in the cost of anything required to maintain a high standard of living, period.
Same as it ever was...
No rate hike.......but we promise December is coming soon.
Yep, still waiting for that long winter...
ZH, I am surprised that even you think that the recession was over.
To be continued.... Now for a commercial break from our sponsors.....
Wolf, Wolf, Wolf, WOlf........ Wolf, Wolf, Wolf, WOlf........
yell it long enough nobody listens
Raise rates and the debt ceiling in the same month??? Yea, sure. Fucking farce.
So Fed should be concerned because Coach and Burberry raised their prices??
Almost half of the August advance in the index for final demand services is attributable to margins for apparel, footwear, and accessories retailing, which jumped 7.0 percent
"Odds rise"....In gambling vernacular, odds "fall" as percentages rise.
The Odds of Obama coming out today and admiting he is a flaming cocksucking queer woh takes Reggie and others in his punk ass are better than the odds of a rate hike.
I'm confused. I thought inflation was good? <Sarc>
I'm going to guess that the retail boost is due to back to school shopping and nothing else, so it will be a blip. As for the YoY increase which takes that into account, well, there's your increased spending due to low gasoline prices finally coming into play.
Bet this rise doesn't hold out until Christmas.
so when it all comes down to it battery hens are the key to the future of civilization itself?
The fed wont do shit. Yet.
What's the ostrich eggs index doing?
While still well below Fed mandated levels, the 0.9% year-over-year rise in PPI Final Demand ex Food & Energy is the hottest since March and notably above expectations.
"ex Food & Energy" ...
Food: Fuel for labor
Energy: Fuel for Machinery
Neither of import when it comes to production ... so lets ignore them.
What a charade all this is!
All the numbers look great...even our intelligence reports look great...just what the muslim retard nigger in the Black House predicted. Every thing is hunky dory.
"surging prices for chicken eggs (+23%)"... WTF... the perfect example of the Fed's favorite meme... "transitory"... How much more "transitory" can you get then a chicken egg...LOL.