The Producer Price Index rose by 0.9% in July.
That annualizes out to about an 11% inflation rate, though it should be noted that this is only 1 month of data.
I'm more pro tariff than a lot of people, I believe that friction in international commerce and international finance is a good thing because it provides stability and prevents destructive capital flows. (I take the term "Destructive Capital Flows," from Keynes.)
That being said, tariffs drive up costs. That's as close to a fact as you can find in economics.
The question is, or should be, whether the additional costs create any societal benefit, and if so, is the benefit worth the cost.
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.
To quote Bette Davis, "Fasten your seat-belts; it's going to be a bumpy night."
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