Huge Gasoline Price Drop Sparks Biggest US PPI Plunge Since COVID Lockdowns

After four months of re-acceleration, US producer prices tumbled in October – down 0.5% MoM, the biggest drop since April 2020. This dragged Final Demand PPI YoY down to 1.3%…

Source: Bloomberg

The sharp slowdown was largely reflective of a decline in gasoline prices, as excluding food and energy, the so-called core PPI was unchanged (and the smallest annual increase since the start of 2021).

Over 80% of the decrease in goods prices was due to a 15.3% slump in the cost of gasoline, the government report.

Services costs, meanwhile, were flat after rising six straight months.

More good news is that the pipeline for PPI (fro intermediate demand) has started to fall once again…

Source: Bloomberg

Let’s just hope that gas prices remain low… We know Biden and Powell are betting on it.