US Producer Price Inflation Tumbles To Lowest Since Jan 2021

After yesterday's marginal cooling in CPI, Producer Prices were expected to rise MoM (after falling last month) but further slowing on a YoY basis. Following the big surprise 0.5% MoM decline in March, April's PPI rose 0.2% MoM (less than the 0.3% exp), which slowed the YoY change to 2.3% (from 2.7% and below the 2.5% exp)...

That is the lowest PPI since Jan 2021...

Source: Bloomberg

Core PI also slowed from +3.7% YoY to +3.4% YoY.

The 'pipeline' for PPI is now showing DEFLATIONARY signals...

Source: Bloomberg

Finally, it appears PPI is leading the charge of all the 'flation' indicators tracking M2's collapse...

Source: Bloomberg

All of which gives The Fed more room to pause (or cut on event risk)