Progressive Politics

The February Producer Price Index (PPI) data release came in way hotter than expected, exceeding consensus expectations by nearly double. This is on top of an already hot January report, which signifies that goods and services inflation in the pipeline is very much a trend and not an isolated event. PPI typically foreshadows consumer inflation - where the public really begins to feel the pain - by about two to three months. And these numbers don’t include the impact of the war in Iran and the unbelievable spike in energy costs. Today we break down the nature of inflation shocks, why this differs from the dual oil shocks of the 1970s, but how it has already produced the same stagflationary result.