Previous Trading Days Events 13 Dec 2023

PPI data were reported yesterday showing no change in U.S. producer prices in November amid cheaper energy goods. The related report also showed that services prices remained flat for a second straight month, boosting optimism that overall inflation would continue to subside and allow the Federal Reserve to start cutting interest rates next year.

The good news today is that there are minimal price increases at the lower stages of factory production, said Christopher Rupkey, chief economist at FWDBONDS in New York. This makes it even more likely they Fed officials will bring inflation down for a softlanding without bringing the economy to its knees.

Though inflation remains above the Feds 2 target, price increases are less broadbased.

While consumer spending is still fueling inflation even in service categories such as leisure and hospitality industries, the downward trend among service providers own costs suggests that if consumer demand cools, consumer price inflation should also then have a path to stability, said Kurt Rankin, senior economist at PNC Financial in Pittsburgh, Pennsylvania.

This report provides another small piece of good news at the margin in the Feds quest to return inflation to 2, said Conrad DeQuadros, senior economic advisor at Brean Capital in New York.

Source httpswww.reuters.commarketsususproducerpricesunchangednovember20231213

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