The January Producer Price Index landed with a predictable media spin: “hotter than expected” and therefore proof that tariffs, Trump, and the so-called “new protectionism” are reigniting inflation. That narrative collapses under even modest scrutiny of the underlying data.
Start with the topline. Total PPI rose 0.5 percent in January, above the 0.3 percent consensus and following a 0.4 percent increase in December. On a year-over-year basis, producer prices are up 2.9 percent. That’s above expectations—but critically, it is still well below the 3.8 percent pace recorded in January 2025. In other words, inflation at the producer level remains materially cooler than it was a year ago.
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