Research Summary

The report discusses the Producer Price Index (PPI) numbers for June, which measures the average change over time in the selling prices received by domestic producers for their output. The PPI for final demand increased by 0.1% in June, driven mainly by a 0.2% increase in final demand in services. The final demand for energy also increased by 0.7%. However, intermediate demand, which are input costs, declined during June. The report suggests that inflation at the producer level is cooling, although there is some stickiness in services.

Actionable Insights

  • Monitor the PPI: The PPI numbers for June show an increase in final demand but a decline in intermediate demand. This could impact the Consumer Price Index (CPI).
  • Watch for changes in energy demand: There was a slight increase in energy demand in June, which could have implications for energy prices and related sectors.
  • Consider the impact on company revenues and margins: If companies reduce pricing due to the decline in intermediate demand, this could lead to lower revenues and margins.

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