Wholesale Inflation Has Biggest Jump in 15 Years

Today the government reported that wholesale inflation had its biggest jump in 15 years last month. The Producer Price Index rose by 1.9% in September. However, just like the CPI report, the “core rate” was much less, increasing by 0.3%. Economists were expecting a 0.2% increase. The long-end of the bond market is rallying today, however the 90-day T-bill is finally moving higher. Today’s theme: The yield curve is getting narrower.
The best news today is that it looks like Tropical Storm Wilma may miss the Gulf Coast. Oil is trading lower.

Dealers had worried that Wilma, the 21st named storm of the 2005 Atlantic season, could delay a recovery in U.S. output ahead of peak winter heating fuel demand in the northern hemisphere.
As much as 66.4 percent of the Gulf of Mexico region’s normal 1.5 million barrels per day (bpd) production remains shut after Hurricanes Katrina and Rita. Five refineries amounting to 1.3 million bpd, or 7.7 percent of U.S. capacity, remain shut.

Posted by on October 18th, 2005 at 10:54 am


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