January PPI came in much hotter than expected while housing starts and permits fell far short of consensus, stoking persistent fears of stagflation. PPI came in at 0.3% MoM versus 0.1% expected. Excluding food and energy, core PPI rose 0.5% versus 0.1% expected. Stripping out trade services, the tally rose to 0.6%, its highest print since January 2023.
Monthly gains in the index for final demand for services again outpaced that for goods at +0.6% versus -0.2%. Had energy prices not continued their decline (-1.7%) the print would have been even more alarming.
Futures had been slightly higher overnight, but fell into the red after the closely followed prints. 
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