US: Inflation far from becoming unhinged - Wells Fargo

Today’s data showed the the PPI index rose in April 0.1% (2.6% annual). According to analysts at Wells Fargo, more temperate gains across categories suggest that while inflation is strengthening, the pickup remains orderly

Key Quotes:

“Producer prices rose at a more tepid pace in April, increasing 0.1 percent. On a year-ago basis, the PPI slipped to 2.6 percent. Our preferred measure of core PPI slowed to 2.5 percent, but is up from 2.0 percent last April. “

“Prices for goods were unchanged in April as a 1.1 percent drop in food prices offset higher energy and core goods prices.

“Prices further back in the pipeline rose last month, but have eased on trend for unprocessed goods over the past year. In contrast, services continue to see input price pressures gradually rise.”