Producer Prices Not So Benign

The headlines are positive.  The Wall Street Journal says "Core Wholesale Prices Decline,
Suggesting Inflation Is Easing."  The year-over-year charts seem to confirm this:

However, headline PPI features the "finished goods" category.  Look this month at crude materials and intermediate.  (Examples: bread is a finished product, wheat flour is intermediate, wheat grain is crude.)

We are now benefiting from the declines of earlier in the year.  The recent price increases in the crude and intermediate categories are "in the pipeline," though finished goods inflation is often muted compared to crude and intermediate price inflation.  However, we have some bad news coming in the next few months.

Business Strategy Implications:  Manufacturers and other purchasers of goods should expect further cost pressures in the coming months.