PPI increased by 2.1% YoY in January, the sharpest increase in 15 months. The monthly increase of 0.5% strongly outpaced expectations of 0.2%. 
Most of the commentary attributes the beat to transitory trade factors. Yet even core PPI increased at 1.5% YoY.
Futures initially slipped about 1 point on the news, then settled higher, paced by a vitally important breakout in USDJPY. 
DXY is also threatening new highs as EURUSD tagged our next lowest and most important downside target in years. Yes, this is one of those kitchen sink moments.
I suppose in a logic-based economy a PPI print such as this would diminish expectations of further CB easing. But, that ship sailed a long time ago. The latest numbers I’ve seen call for 60% odds of further rate cuts in July.
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