Staff Reports
In the latest episode of the ongoing inflation saga, the producer price index (PPI) took a jog up the hill in November, demonstrating that the Biden administration’s supposed grip on inflation is more of a slippery slope. According to the Bureau of Labor Statistics, prices paid to U.S. producers increased by 0.4 percent in November, a figure that was a tad higher than what economic seers had predicted. Last month’s performance wasn’t any better, as it was revised upward from 0.2 percent to a decidedly less impressive 0.3 percent.
When casting an eye over the year, the numbers reveal a chilling tale: the PPI is up a hefty 3 percent compared to last year, marking the most significant year-over-year spike since February 2023. For those who might be confused, the PPI serves as a bellwether for the prices that producers receive for their goods and services. It leaves out imports, focusing instead on the beloved exports, while the consumer price index (CPI), the more popular cousin, does just the opposite. Specifically, the PPI tracks prices for producers, including those paid by government entities and businesses—leaving the everyday consumer out of the mix.
When it comes to core producer prices, which exclude the ever-volatile food and energy prices, they still managed an increase of 0.2 percent. While some might call that a sign of stability, it’s merely a slower turtle in the race; last month saw a more spirited 0.3 percent increase. Overall, core producer prices climbed by 3.4 percent over the year, but it’s hardly a reason to throw a confetti party.
Biden’s Legacy: Producer Price Inflation Jumps Higher Than Expectedhttps://t.co/7GSifalTXC. Bidenomics is almost gone forever
— KC Loughlin III (@kcloughlin03) December 13, 2024
In a new twist of jargon, there’s also the “core core” measure, which is practically a metrics inception—core prices excluding food, energy, and even trade services. It crept up by 0.1 percent for the month and is up 3.5 percent from last year. With this new term in circulation, one wonders whether we should also prepare for “core core core” measurements any day now.
A major contributor to this price surge is the remarkable 3.1 percent hike in food prices, with the price of eggs making headlines for their shocking 54.6 percent increase. So, while the costs of getting breakfast on the table soar, the admin’s economic policies might be better at raising eyebrows than raising hope. Goods prices generally saw a 0.7 percent increase, courtesy of skyrocketing food prices, while services prices inched up by a modest 0.2 percent. Investors and consumers alike might find themselves wondering when the real change comes, assuming it ever does.
