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producer price index came in hot
producer price index came in hot
inflation is starting to bite
https://www.marke ch.com/story/wh...ation-1cdc1ddeThe cost of wholesale goods and services — where rising inflation tends to show up first — posted the biggest increase in July in three years, possibly heralding a sizable acceleration in price hikes tied to U.S. tariffs.
The producer price index jumped 0.9% last month after no change in June, the government said Thursday.
Some but not all of the increase occurred in goods directly affected by tariffs. Food was the biggest contributor to higher wholesale prices last month.
The yearly rate of wholesale inflation climbed to 3.3% from 2.3% — a five-month high.
Another gauge known as the core rate that is seen as a more stable measure of wholesale inflation rose 0.6% in July. That was the biggest increase in three and a half years.
The 12-month increase in the core rate moved up to 2.8% from 2.5%.
The wholesale report doesn’t capture the cost of imports as well as the consumer price index, but the CPI also showed a stiffer increase in July.
https://www.cnbc.com/2025/08/14/ppi-...uly-2025-.htmlWholesale prices rose 0.9% in July, much more than expected
Wholesale prices rose far more than expected in July, providing a potential sign that inflation is still a threat to the U.S. economy, a Bureau of Labor Statistics report Thursday showed.
The producer price index, which measures final demand goods and services prices, jumped 0.9% on the month, compared with the Dow Jones estimate for a 0.2% gain. It was the biggest monthly increase since June 2022.
Excluding food and energy prices, core PPI rose 0.9% against the forecast for 0.3%. Excluding food, energy and trade services, the index was up 0.6%, the biggest gain since March 2022.
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With CPI coming in right around expectations earlier this week, markets had been pricing a virtual certainty that the Fed will lower its key interest rate when it meets next in September. Following the release, market-implied odds of a September cut decreased but only slightly, according to the CME Group’s FedWatch tool. Traders did substantially lower the probability for three cuts this year.
“The large e in the Producer Price Index this morning shows inflation is coursing through the economy, even if it hasn’t been felt by consumers yet,” wrote Chris Zaccarelli, chief investment officer at Northlight Asset Management. “Given how benign the CPI numbers were on Tuesday, this is a most unwelcome surprise to the upside and is likely to unwind some of the optimism of a ‘guaranteed’ rate cut next month.”
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https://www.bloomberg.com/news/artic...rs-on-servicesUS Producer Prices Rise by Most in Three Years on Services
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“The question for policymakers, still to be resolved, is how much of these price increases are absorbed by wholesalers, retailers and resellers,” Carl Weinberg, chief economist at High Frequency Economics, said in a note. “This report is a strong validation of the Fed’s wait-and-see stance on policy changes.”
Economists pay close attention to the PPI report because some of its components are used to calculate the Fed’s preferred measure of inflation — the personal consumption expenditures price index. While health care categories came in soft, airline passenger services and portfolio management jumped. The latter was largely expected due to a rising stock market.
The BLS data showed food prices accounted for 40% of the advance in final goods costs, largely due to vegetables. A less-volatile PPI metric that excludes food, energy and trade services also rose from a month earlier by the most since 2022.
The PPI report showed the costs of processed goods for intermediate demand, which reflect prices earlier in the production pipeline, jumped 0.8% — the most since the start of the year and largely due to diesel fuel.
A separate report showed initial claims for unemployment benefits were little changed last week.
my working hypothesis is that Trump likes to tariff industrial inputs because affected firms will approach him for carve outs
big companies will be able to afford the carve outs, small ones won't, the cost gets passed on to the consumer regardless
TRUMP ON TRADE: I'LL BE SETTING TARIFFS ON STEEL, CHIPS NEXT WEEK
https://www.theguardian.com/us-news/...climate-changeFarmers in US midwest squeezed by Trump tariffs and climate crisis
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With the soybean harvest in the midwest set to start about a month from now, and corn following weeks later, the fear that China may not buy a single shipload of grain this season is growing for many.
“With [tariffs] in place, we are not compe ive with soybeans from Brazil. Our marketing year starts 1 October and usually by now we’d see China making commitments to pre-purchases for soybeans. China has not made a single purchase for US soybeans,” says Virginia Houston, director of government affairs at the American Soybean Association, a lobbying organization.
“No market can match China’s demand for soybeans. Right now, there is a 20% retaliatory duty from China.”
To appease his farming base, the Trump administration announced $60bn in subsidies for farmers over the next decade in the recent tax bill, but that has drawn criticism from those who say that farmers shouldn’t be subsidized on taxpayers’ dime.
Others have reported that funding is going to select producers in specific regions of the US, benefiting bigger producers rather than family farms. Adding to the export challenges, the price of commodity crops in the US has been in steady decline for the past three years due to a smaller cattle herd and falling ethanol production.
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Others have reported that funding is going to select producers in specific regions of the US, benefiting bigger producers rather than family farms.
Of course there are more bailouts coming. It's always the end result for republicans when pure capitalism fails.
deals that aren't written down aren't really deals
https://www.bloomberg.com/news/newsl...-state-of-playAs my Bloomberg colleagues reported over the weekend, US trading partners who thought they had secured deals with the Trump administration are getting increasingly frustrated with delays in finalizing what were really only tentative pacts.
Trump, for one, hasn’t signed an executive order implementing the smaller tariff increase, and the US is continuing to apply maximalist tariffs that other countries had supposedly negotiated away. European Union, Korean and Japanese cars entering the US are still being taxed at 25% rate when Trump agreed that they would face a 15% rate.
Even that lower rate is already six times what imported cars faced until a few months ago and the financial consequences are significant. Toyota recently said it expected a hit of $9.5 billion from Trump’s tariffs.
“The bleeding hasn’t stopped,” Japan’s chief trade negotiator Ryosei Akazawa said Friday of the country’s car industry. “We want the US to sign the executive order as soon as possible.”
The UK, meanwhile, is still waiting to finalize steel tariffs Trump agreed — more than three months ago — to cut to a zero rate for at least an initial quota.
https://edition.cnn.com/2025/08/19/e...tariffs-pricesHome Depot says it will raise some prices because of tariffs
Home Depot said Tuesday that some of its prices could be going up because of the cost of tariffs.
Until now, America’s largest home improvement retailer has limited what it has said about the impact of tariffs on its prices. But after reporting quarterly results Tuesday, CFO Richard McPhail said Home Depot would have to implement some price increases as a result of the Trump administration’s taxes on imports.
“For some imported goods, tariff rates are significantly higher today than they were at this time last quarter,” he said in an interview with the Wall Street Journal that was confirmed by the company to CNN. “So as you would expect, there will be modest price movement in some categories, but it won’t be broad based.”
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Despite sales in the quarter jumping 5% from last year, Home Depot’s net income slipped 0.2% over the same time period due to higher operating costs. The company believes its full-year earnings per share will fall 2% as economic uncertainty and high interest rates are keeping many consumers from moving forward with major home renovation plans.
“Certainly some relief on mortgage rates in particular could help,” CEO Ted Decker said on the earnings call. Mortgage rates have spent most of the year stuck just under 7%.
“When we talk to our customers… both consumers and pros, the number one reason for deferring the large project is general economic uncertainty. That is larger than prices of projects, of labor availability. By a wide margin, economic uncertainty is number one,” he added.
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https://www.cnbc.com/2025/08/19/trum...-tariffs-.htmlTrump expands 50% steel and aluminum tariffs to include 407 additional product types
The Trump administration has quietly expanded its 50% steel and aluminum tariffs to include more than 400 additional product categories, vastly increasing the reach and impact of this arm of its trade agenda.
The new tariffs, which took effect Monday, expand the scope of the levies that President Donald Trump previously announced on the valuable commodities. The tariff list now covers products such as fire extinguishers, machinery, construction materials and specialty chemicals that either contain, or are contained in, aluminum or steel.
“Auto parts, chemicals, plastics, furniture components—basically, if it’s shiny, metallic, or remotely related to steel or aluminum, it’s probably on the list,” Brian Baldwin, vice president of customs at Kuehne + Nagel International AG wrote on LinkedIn of the expanded list.
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The release from the agency links out to a list that identifies the newly included product types only by the specific customs codes that apply to them, not by what the products are actually called.
For example, the Commerce Department identifies the product category of fire extinguishers only as “8424.10.0000,” a 10-digit code buried among hundreds of other 10-digit codes.
This format makes it very difficult for the public to get a full picture of all the products that are affected by Monday’s expanded tariffs.
But experts say the impact will be enormous.
“By my count, the steel and aluminum tariffs now affect at least $320 billion of imports based on 2024′s general customs value of imports,” Jason Miller, a professor of supply chain management at Michigan State University, wrote on LinkedIn.
“This will add more inflationary cost-push pressures to already climbing prices that domestic producers are charging as picked up by July’s PPI data,″ he continued.
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Tsa posting less and less here. I guess it's harder to post from Korea.
https://newrepublic.com/post/199266/...e-mass-layoffsIn Wake of Trump Tariffs, John Deere Announces Mass Layoffs
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In that same earnings call, John Deere attributed a slowdown in Q3 sales to customer cautiousness amid Trump’s freewheeling tariff policy.
“If you have customers that are concerned about what their end markets are going to look like in a tariff environment, they’re waiting to see the outcomes of what these trade deals look like,” said John Deere executive Cory Reed.
“The primary drivers for the change from last quarter are increased tariff rates on Europe, India, and steel and aluminum,” said Josh Beal, the company’s director of investor relations.
Estimating that tariffs have already cost the company $300 million this year, Beal forecast a full-year tariff impact of nearly $600 million.
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https://driving.ca/auto-news/industr...riff-june-2025Canada imported more vehicles from Mexico than from U.S. in June
Canada has traditionally purchased the bulk of its auto imports from the U.S., but now the two countries’ tariff war has changed all that. For the first time in some 30 years, Canada’s single-month imports from Mexico, in June 2025, topped the number of cars it bought from the United States.
According to Bloomberg, citing Statistics Canada, a total of $1.08 billion in passenger vehicles went from Mexico into Canada; while only $950 million came into Canada from American factories (all figures in Canadian dollars). That sort of ratio hasn’t happened since the early 1990s.
Whether that trend will continue has yet to be seen, as figures for July haven’t yet been released. Canada also imported a relatively large number of vehicles from the U.S. ahead of the effective date of the tariffs – about $2.5 billion in February and March, when it usually averages $1.8 billion – which may have given it a cushion while both countries figure out exactly how future trade is going to work.
Statistics Canada reported that all vehicle imports into Canada rose by 6.9% in June, mostly due to that increase from Mexico, following two months of consecutive decline. However, imports of automotive engines and parts into the country fell by 4.8%, “amid declining motor vehicle production in Canada,” the federal agency said.
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IIF: “.. While domestic firms initially absorbed much of the tariff impact through margins and pre-policy inventories, that cushion seems to be now gone. As Q3 unfolds, final goods are expected to be increasingly priced at the new, tariff-inclusive cost base .. shifting .. toward final consumers.”
https://www.huffpost.com/entry/sony-...b0903a790e1abeSony Hikes PlayStation 5 Price To Cover Tariffs And Gamers Are Furious: 'Trump Is 100% To Blame'
Sony has announced a $50 price hike for all three versions of its flagship video game console, the PlayStation 5, in the United States — and social media is furious. The company previously confirmed President Donald Trump’s ongoing trade war could lead to rising prices.
Sony’s vice president of global marketing, Isabelle Tomatis, broke the news Wednesday.
“Similar to many global businesses, we continue to navigate a challenging economic environment,” she wrote. “As a result, we’ve made the difficult decision to increase the recommended retail price for PlayStation 5 consoles in the U.S. starting August 21.”
Buyers will now have to s out $549.99 for a base model, which originally cost $500 when it hit stores in 2020, and spend almost $500 for a “Digital Edition,” which doesn’t contain a disc drive and initially cost $450 — or spend about $750 for the coveted “Pro” version.
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More "emergency" tariffs incoming:
https://www.cnbc.com/2025/08/22/trum...ure-trade.htmlTrump says furniture tariffs are coming later this year
The Trump administration has launched an investigation into imported furniture, President Donald Trump said Friday, setting the stage for new tariffs on a wide range of products.
“Within the next 50 days, that Investigation will be completed, and Furniture coming from other Countries into the United States will be Tariffed at a Rate yet to be determined,” Trump wrote on his Truth Social platform. “This will bring the Furniture Business back to North Carolina, South Carolina, Michigan, and States all across the Union.”
Following Trump’s post, shares of top furniture and home goods companies, including Wayfair, RH and Williams-Sonoma, tumbled in after-hours trading.
Wayfair imports much of its furniture. RH, formerly Restoration Hardware and Williams-Sonoma have been working to diversify their supply chains.
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More "emergency" tariffs incoming:
https://www.cnbc.com/2025/08/22/trum...ure-trade.htmlTrump says furniture tariffs are coming later this year
The Trump administration has launched an investigation into imported furniture, President Donald Trump said Friday, setting the stage for new tariffs on a wide range of products.
“Within the next 50 days, that Investigation will be completed, and Furniture coming from other Countries into the United States will be Tariffed at a Rate yet to be determined,” Trump wrote on his Truth Social platform. “This will bring the Furniture Business back to North Carolina, South Carolina, Michigan, and States all across the Union.”
Following Trump’s post, shares of top furniture and home goods companies, including Wayfair, RH and Williams-Sonoma, tumbled in after-hours trading.
Wayfair imports much of its furniture. RH, formerly Restoration Hardware and Williams-Sonoma have been working to diversify their supply chains.
...
More "emergency" tariffs incoming:
https://www.cnbc.com/2025/08/22/trum...ure-trade.htmlTrump says furniture tariffs are coming later this year
The Trump administration has launched an investigation into imported furniture, President Donald Trump said Friday, setting the stage for new tariffs on a wide range of products.
“Within the next 50 days, that Investigation will be completed, and Furniture coming from other Countries into the United States will be Tariffed at a Rate yet to be determined,” Trump wrote on his Truth Social platform. “This will bring the Furniture Business back to North Carolina, South Carolina, Michigan, and States all across the Union.”
Following Trump’s post, shares of top furniture and home goods companies, including Wayfair, RH and Williams-Sonoma, tumbled in after-hours trading.
Wayfair imports much of its furniture. RH, formerly Restoration Hardware and Williams-Sonoma have been working to diversify their supply chains.
...
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