Producer prices were high across the board in July. 
The Bloomberg Econoday consensus was for producer prices to rise 0.2 percent.
However, the BLS reports Producer Prices for Final Demand rose 0.9 percent.
Final Demand Services
- The index for final demand services moved up 1.1 percent in July, the largest advance since rising 1.3 percent in March 2022. Over half of the broad-based July increase is attributable to margins for final demand trade services, which jumped 2.0 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.) Prices for final demand services less trade, transportation, and warehousing and for final demand transportation and warehousing services advanced 0.7 percent and 1.0 percent, respectively.
- Product detail: Thirty percent of the July rise in prices for final demand services can be traced to margins for machinery and equipment wholesaling, which jumped 3.8 percent. The indexes for portfolio management; securities brokerage, dealing, investment advice, and related services; traveler accommodation services; automobiles retailing (partial); and truck transportation of freight also advanced. In contrast, prices for hospital outpatient care fell 0.5 percent. The indexes for furniture retailing and for pipeline transportation of energy products also declined.
Final Demand Goods
- Prices for final demand goods moved up 0.7 percent in July, the largest advance since rising 0.7 percent in January.
- Forty percent of the broad-based increase in July can be attributed to the index for final demand foods, which jumped 1.4 percent. Prices for final demand goods less foods and energy and for final demand energy moved up 0.4 percent and 0.9 percent, respectively.
- Product detail: A quarter of the July advance in the index for final demand goods can be traced to prices for fresh and dry vegetables, which jumped 38.9 percent. The indexes for meats, diesel fuel, jet fuel, nonferrous scrap, and eggs for fresh use also rose. Conversely, prices for gasoline decreased 1.8 percent. The indexes for canned, cooked, smoked, or prepared poultry and for plastic resins and materials also declined.
Month-Over-Month Details
- Final Demand: 0.9 percent
- Final Demand Goods: 0.7 percent
- Final Demand Services: 1.1 percent
- Final Demand Food: 1.4 percent
- Final Demand Less Food and Energy: 0.9 percent
PPI Final Demand Year-Over-Year
Year-Over-Year Details
- Final Demand: 3.3 percent
- Final Demand Goods: 1.9 percent
- Final Demand Services: 4.0 percent
In all of the above, it appears PPI year-over-year has bottomed and heading higher.
Tariff Impact?
That’s what this jump looks like to me, especially the margins for machinery and equipment wholesaling, which jumped 3.8 percent.
Food imports are another concern.
Whatever the cause, some of this will undoubtedly be passed on to consumers.
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The stock market liked the CPI report more than the bond market.
More tests scheduled today.
Same story. I expect to come home from the Hospital, but they may keep me.
One post scheduled. – That’s not a sign I am back.
Sending you support and healing – and gratitude for all your hard work and energy invested in your blog
Mish, I have been reading you for 20 years now and consider you to be a true gift to my perspective. We do not always agree but that is just fine.
Heal quickly is there is anything truly ailing you! And if they are doing stents, know that they are performing even better than before!
Here’s to 20+ more years!
Big HUGS from all of us!
>
Good luck and best wishes.
Good luck.
Hang in there, Mish!
best wishes–I hope your tests are filled with “fake news” and you remain in good health
Take it easy… you don’t owe us anything. If you take a break, we’ll be here when you get back. You getting healthy is the only thing that matters.
Very sorry to hear of the continued concerns. May you heal up soon/receive the treatment that does the trick!
“The art of medicine consists of amusing the patient while nature cures the disease.”
― Voltaire
Hope the tests turn out well.
You’ve contributed so much here. More chapters to come!
good luck
It took longer for the tariffs to hit the economy in the form of inflation last time. This time importers know that the result will be price increases so they will pass them on sooner. Plus it is a quiet FU to Trump and his sycophants before he can send them their bribery checks of $5,000.
Supposedly tariff benefits? My ass!
Trump is a fraud!
25th amendment the bully!
>
Create a problem by destroying the economy solve the problem by government takeover and say everything is great.
Fire the person who released these numbers!
Seems like a pattern is developing here.
Denial is strong with this trump fella…
Given the federal deficit is still running 7% of GDP, this should be entirely expected.
“1. Consensus Forecasts: Bloomberg Econoday aggregates forecasts from numerous economists for various economic indicators. This provides a “wisdom of the crowds” perspective on what the market expects.
2. Surprise Indices: The platform also offers surprise indices, such as the Bloomberg Economic Surprise Index, which track how actual data releases deviate from these consensus forecasts. This helps users understand the market’s reaction to unexpected data.”
Bloomberg vs BLS, it’s a tough call.
Being a head of BLS is suddenly worst job possible.
Just fudge those numbers,dammit. Nobody believes it anyway.
Or just go full china and stop publishing this altogether and can live in a bliss Trump utopia
This is a hoax spilled by Clinton and Obama.
Only a handful of things are falling in price. $Melania meme coin is one of them.
Currently at 20 cents, down 99% from when it was introduced.
Is she a mute? She reminds me of a battered wife that is scared to say anything!
Within a few Qt PPI final demand goods (yellow) will rise above service (brown),
but first both might trend down. GDP might rise to the $36T/$40T, or above.
Good Luck.
Corn producers dreading harvest booming yields with low, low prices and disappeared markets–they’re hanging their hopes on Trump going all-in on E-85 (what are the drill-baby-drill enthusiasts to do?)
Soybean producers have no sales to China –they’re hanging their hopes on Brazil selling out to the bottom of their bins for China to start buying at the end of the year.
It’s all wonderful, ain’t it?
Economic busts are always composed of millions of promises that are impossible to keep.
corn production costs at $4.75 per bushel, prices predicted heading down to $2.80 or $2.90 at harvest
The income from the tariffs will go to help the farmers. Same as last time.
Soybean producers should be fine. After China buys all the Brazil harvest then any country that used to buy from Brazil will now have to buy American.
14 Jul 2025 — Brazil’s 2024/25 harvest, projected to hit 130.6 million tons—a 9% year-over-year increase—could redefine supply dynamics, pricing pressures, …
They will still drop rates.
I went to Costco the other day. The 3lb. bag of coffee beans that I used to buy in the range $13-$15 now costs $20. When are we going to start growing coffee in the US?
Another couple decades of climate change should make it possible.
You want American labor prices picking those beans instead of some 10 year old kid in Colombia or Brazil who works for 10 cents an hour?
corn farmers have big opportunity to change their crops if soil, weather, etc are favourable.
For the Luddites, Coffee Harvesting in Cerrado, Brasil. See the child laborers?
https://www.youtube.com/watch?v=CCOMM84jhZg
Oh my! This report is going to spill into the employment report next month as those responsible for this bogus report will need to be terminated. It can’t be tariff related, Taco said as much. This whole tariff fiasco looks like it is managed by Larry, Curly , and Moe. It would be funny if not so wrong headed.
We need Shemp to come in and slap some sense into those numbskulls.
My biological image of this is, Trump found a tree that was a bit unwell, and decided that thrashing it with a great deal of tough-guy randomness would fix it. Or at least,it would burnish his “all-important” self-image.
Clearly someone needs to be fired over this. Must be political number rigging. Can’t wait to hear what our ahole in chief rages over this. Looks like rate cut hopes are fading fast.
“Trump’s proposals for Putin will include granting Russia access to Alaska’s natural resources”
https://newsukraine.rbc.ua/news/trump-to-offer-putin-minerals-deal-in-exchange-1755113861.html
He’s currently busy giving away American assets for a cease fire. What a groveling worm this guy is.
Maybe Trump will give Alaska back to Putin if he promises to return Crimea to Ukraine?
Trump will do whatever generates the largest amount of tactical distraction. It is the absolute value of the noise, not its target or direction or content or nature or validity, that matters. No need to go strategic, as his base lacks capacity for that. Everyone will be so dazed, two days from now might as well be two years. The news cycle will be jumped to the next thing.
Not Tariff Related
And you know this “how”?
Year over year PPI:
Services are not tariffed.
whats more pertinent is the 0.7% sequential increase in goods. Goods inflation for the month was near 9% annualized. Thats a scorching pace. Looking at YOY figures mixes in the impact of things that happened before the economically ignorant talking yam took over.
Statistically, too much noise in MOM figures. Often, MOM figures are statistically insignificant.
And when judging a policy including the impact of things that happened prior to the policy is invalid so YOY is irrelevant. Yes the stats can be noisy, and you can’t draw significant conclusions from one data point, but if anything this is limited evidence that tariffs are pushing up prices. YOY comparisons are simply partisan wishful thinking.
Kind of like BLS figures? That now need to be fudged despite these numbers being ‘statistically insignificant’?
That has been going on since the beginning of time. Any good wall street quant knows that. Lots of statistically insignificant data that can be “molded” into what you need to show …
Tell that to Ford and GM. BTW, how are all of our food exports doing?
Bigliest food exports ever. After a new head of food export statistics is hired, that is.
“unexpectedly”…
My thoughts exactly.