PPI sinks
A big decline in the headline producer price index from the US, dropping -0.5 per cent in December (the previous month's result was also revised down to +0.2 per cent).
It was the biggest drop in the headline result since April 2020.
Bloomberg with the charts:
Source: Bloomberg
Disinflation is gathering pace now, the annual result for PPI dropping far further than expected last month from 7.3 per cent to 6.2 per cent (the core reading was 5.5 per cent).
Source: Bloomberg
The index has dropped very sharply over the past six months, and with retail sales and other indicators turning deeply negative, it may not be too long before rate cuts are being discussed.
Australia reports its inflation data both quarterly and late, so alas we'll still have one more round of reporting hysteria to go through next week.
But it's clear that the inflationary spike will soon be over.
