Economic data released Wednesday showed consumers continued their frenetic purchasing pace in November, but wholesale prices rose more slowly than expected.
The producer price index, a measure of the final demand price that producers receive in the market, rose just 0.2% in the month, according to seasonally adjusted figures from the Bureau of Labor Statistics. Although that was a tenth of a point higher than in October, it was below the Dow Jones consensus for a 0.3% rise.
Core PPI, which excludes food and energy, was flat from the previous month, contrary to expectations for a 0.2% rise.
Despite the weak monthly data, headline PPI rose 3% year-on-year, well above the Federal Reserve’s 2% target. Core PPI, which excludes trade services, rose 3.5% annually, marking the largest 12-month increase since March 2025, according to the BLS.
A 0.9% rise in commodity prices drove most of the PPI increase, with more than 80% coming from a 4.6% rise in energy prices. Service prices remained flat.
On the consumer side, retail sales rose 0.6% in November, according to Commerce Department statistics (seasonally adjusted, not inflation). Economists polled by Dow Jones had expected a rise of 0.4%. Excluding automobiles, sales rose 0.5%, compared to the expected 0.3% increase.
The rise in November was wide-ranging, with auto and parts stores, building materials and garden centers, gas stations, sporting goods stores, and other retailers all seeing increases of more than 1%.
Compared to the same month last year, sales rose 3.3%, outpacing the 2.7% rise in the Consumer Price Index for the same month. The control group, which removes some categories and incorporates them into gross domestic product calculations, rose 0.4%, in line with market consensus.
BLS PPI data is still behind schedule due to last year’s government shutdown, and retail sales reporting is also delayed.
Financial markets reacted little to the data, with stock futures trading lower and U.S. Treasury yields nearly flat. Traders continue to believe there is virtually no chance the Fed will set interest rates when it meets later this month.
