The disinflation is not so immaculate

January PPI was hotter than expected with .3% and .5% headline and core gains vs the estimate of up .1% for each. The y/o/y gains are .9% and 2% respectively, 3 tenths higher for headline and 4 tenths above the forecast for core. Energy prices though did fall by 1.7% m/o/m and 9.8% y/o/y, driven by a drop in gasoline prices which in February are now rising again. Food was down too, by .3% m/o/m and 3.6% y/o/y.

And overall goods prices were down as iron and steel scrap prices moved lower too along with electric power prices. On the upside, price gains were led by communication and equipment prices which jumped by 2.4%.