Preview: Due July 12 - U.S. June PPI - Subdued, if not as weak as in May
We expect a subdued June PPI, unchanged overall with a 0.2% increase in the core rates ex food and energy and ex food, energy and trade. However the data will be not quite as soft as seen in May, which corrected from a stronger April.
May PPI fell by 0.2% with unchanged outcomes ex food and energy and ex food, energy and trade, which corrected from strong gains of 0.5% in all three indices in April.
Underlying trend is probably near 0.2% per month but the headline rate looks set to come in weaker than the core on continued declines in energy. We expect food to rise by 0.2% after a 0.1% May decline.
Our forecast would leave yr/yr growth unchanged overall at 2.2% with the ex food and energy rate rising to 2.5% from 2.3%, reversing a May dip. Ex food, energy and trade we expect yr/yr growth to slow to 3.0% from 3.2%.
