This morning, the December PPI report told a much different story than yesterday’s CPI release as producer prices signaled deflation at the wholesale level for the third consecutive month. Whereas consumer prices had been warmer than expected in December, producer prices were much cooler. Headline PPI unexpectedly fell -0.1%, while the previously reported unchanged reading for November was revised downward to -0.1%. For all of 2023, overall PPI rose by just +1.0% compared to +6.4% in 2022. When food and energy are excluded, core PPI was up +0.2% for the month and +1.8% year-over-year.

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