High PPI More Honest Than CPI, FOMC Has To Look Past It

This morning we saw February Producer Prices come out with a gain of +0.3%, and that is after a +1% gain in January. The core rate on an ex-food and energy basis rose +0.5%. We had penciled in estimates from Bloomberg as +0.4% expected on nominal PPI and +0.2% on Core PPI. If you take everything into consideration, what it really looks like is that the Labor Department was just more realistic on PPI than it was on CPI with that seemingly wrong FLAT release on Friday. Some may say that this should give the FOMC some pause over an...