Following yesterday's hotter than expected Consumer price inflation (and rise in Core CPI), Producer prices confirmed the hotter-than-expected trend, rising 2.7% YoY (vs 2.4% exp). However, unlike CPI, PPI actually rose from December.

While YoY CPI did actually slow in January, YoY PPI actually re-accelerated

A major factor in the January increase in prices for final demand services was the index for hospital outpatient care, which rose 1.0 percent. The indexes for apparel, footwear, and accessories retailing; health, beauty, and optical goods retailing; residential real estate services (partial); long-distance motor carrying; and hospital inpatient care also moved higher. In contrast, margins for chemicals and allied products wholesaling declined 2.3 percent. Prices for wireless telecommunication services and airline passenger services also fell.

Nearly half of the January increase in the index for final demand goods is attributable to prices for gasoline, which climbed 7.1 percent. The indexes for residential electric power, iron and steel scrap, diesel fuel, jet fuel, and fresh and dry vegetables also moved higher. In contrast, prices for chicken eggs fell 38.9 percent. The indexes for residential natural gas and for power cranes, draglines, and shovels also declined.

Interestingly, Core inflation data did the opposite of headline - CPI rose and PPI slowed...