As part of our project to monitor the supply side, we closely track each month’s new data. The PPI release is key for understanding how inflationary pressures propagate through the costs that firms face for intermediate inputs.
It is clear from this month’s manufacturing commentary that an industrial slowdown may be afoot.
With apologies for delay over the Thanksgiving holiday, we present the data recap for Industrial Production.
This month’s release saw continued disinflation in many sections of the Producer Price Index, but a look at the chart for the Final Demand index tells the whole story: producer prices have been parked since June of last year, up just 1.3% over that time period.
Rather than careening from disaster to disaster, we might just be having an economy for the time being. The pandemic showed clear deficiencies in capacity and capabilities across a range of sectors, most of which are taking steps to address those deficiencies now.
