Core Viewpoint - The June PPI in the U.S. showed no month-on-month growth, with service prices unexpectedly declining and moderate increases in goods prices, indicating that the current "inflation pipeline" is not heating up. However, revisions to previous data and a rebound in intermediate demand goods may signal potential risks in the future [1][10]. Group 1: PPI Data Overview - The June PPI year-on-year increased by 2.3%, significantly lower than the expected 2.5%, marking the lowest year-on-year growth since September 2024. The previous value was revised from 2.6% to 2.7% [1]. - The core PPI year-on-year growth was 2.6%, the lowest since March 2024, also below the expected 2.7%, with the previous value revised from 3% to 3.2% [2]. Group 2: Price Movements in Goods and Services - Despite the overall zero growth in PPI, there was a moderate rebound in goods prices, with final demand goods prices rising by 0.3%, the largest increase since February [3]. - Excluding food and energy, goods prices also rose by 0.3%, indicating a broad but moderate inflationary trend [4]. - Energy prices increased by 0.6% month-on-month, while food prices rose by 0.2%. However, energy prices remain in a "deflationary" state year-on-year, providing a buffer for overall PPI growth [5]. Group 3: Service Prices and Inflation Dynamics - Service prices declined by 0.1% month-on-month, down from a previous increase of 0.4%, which was a major driver of the weaker PPI [7]. - The "deflationary" effect in services has successfully offset the price pressures from the goods sector, as companies have not fully passed on tariff pressures, leading to moderate changes in profit margins [8][10]. - The transmission of "tariff inflation" has not fully materialized in June, appearing more like a delayed process [9]. Group 4: Future Outlook and Economic Implications - The path of inflation remains uncertain, with "lagged transmission" being a core concern for the market. Economists believe the coming months will be critical for observing whether "tariff inflation" will be fully released [10]. - The upcoming PCE data is expected to reflect a "moderate inflation" trend, providing the Federal Reserve with room to maintain its interest rate policy in the short term [12].

Core Insights - The Producer Price Index (PPI) for May in the U.S. showed a year-on-year increase of 2.6%, matching expectations, while the core PPI rose by 3.0%, slightly below the anticipated 3.1% [1] - Month-on-month, the PPI increased by only 0.1%, which was lower than the expected 0.2%, indicating a slowdown in price growth [1] - The report highlights that despite the current high tariff policies not significantly impacting consumers, there may be increased price pressures in the second half of the year as companies seek to maintain profit margins [1] Sector Analysis - **Services**: The service sector saw a month-on-month increase of 0.1%, primarily driven by a 2.9% rise in trade service margins, although transportation and warehousing services decreased by 0.2% [2] - **Goods**: Goods prices increased by 0.2% month-on-month, with notable increases in tobacco products (up 0.9%) and gasoline, while jet fuel prices fell by 8.2% [3] - **Core PPI**: Excluding food and energy, the core PPI rose by 0.1% month-on-month and 2.7% year-on-year, indicating stable underlying inflation trends [4] Intermediate Demand - **Processed Goods**: There was a month-on-month increase of 0.1% in processed goods, with processed materials (excluding food and energy) rising by 0.4%, while processed energy goods fell by 1.2% [5] - **Unprocessed Goods**: Unprocessed goods saw a significant month-on-month decline of 1.6%, primarily driven by an 18.7% drop in energy materials like natural gas, alongside a 1.4% decrease in non-food materials [6] Key Price Movements - **Price Increases**: Key items that saw price increases included tobacco (+0.9%), gasoline, diesel, and primary non-ferrous metals (+4.6%) [8] - **Price Decreases**: Items that experienced price declines included jet fuel (-8.2%), pork, carbon steel scrap, and natural gas (-18.7%) [9] - **Service Sector Prices**: In the service sector, air passenger transport prices fell by 1.1%, while furniture retail and securities brokerage services also declined, contrasting with increases in system software publishing [10]

Core Insights - The Producer Price Index (PPI) in the U.S. increased by 2.6% year-on-year in May, aligning with expectations, while the previous value was a 2.4% increase [1] - The core PPI rose by 3% year-on-year in May, which was below the expected 3.1%, and the previous value was also 3.1% [1] - The data indicates that producer price inflation remains moderate due to suppressed costs of goods and services [1] Industry Implications - Economists believe that price pressures will intensify in the second half of the year as companies seek to protect profit margins amid rising costs [1] - The PPI data shows an increase in profit margins for wholesalers and retailers in May, particularly in the automotive and machinery wholesale sectors, following a decline in April [1] - Profit margins have fluctuated monthly this year, highlighting the uncertainty of trade policies on prices and demand [1]

Group 1 - The core PPI in the US for May increased by 3% year-on-year, which is lower than the expected 3.1% and the previous value of 3.1% [1]

Core Insights - The core PPI in the U.S. for April is reported at 3.1% year-on-year, matching expectations and showing a decrease from the previous value of 3.3% [1]