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The CML Close - Stocks mixed, Producer inflation below estimates, rents are too high, consumer borrowing spikes - 08-11-2022

Date Published:

Stocks were mixed. The producers' side of CPI, called PPI and Core PPI, came in well below estimates with headline PPI showing its first month over month decline in over two years.

Consumer borrowing jumped its second most ever as rising prices are funded by debt. Rents, too, are stubbornly high.

SPX 4,207.27 -2.97 (-0.07%)
NASD 12n779.91 -74.89 (-0.58%)
DJIA 33,336.67 +27.16 (+0.08%)
R2K 1,975.26 +6.01 (+0.31%)
VIX 20.19 +0.45 (+2.28%)
Oil 94.28 +2.35 (+2.56%)

• PPI and Core PPI came in well below estimates.

• Consumer borrowing is rising to fund inflation.

• United States Jobless Claims 4-week Average continues to rise as do initial claims.

• Fed leaders continue insist that lower inflation readings will not sway them from tightening.

Headlines of the Day
Stocks Fail to Hold Earlier Gains
Slower U.S. inflation has Wall Street thinking the Federal Reserve might be able to moderate its pace of interest-rate hikes.

Fed Leaders, Unswayed by Softer CPI, See Rate Hikes Into 2023
Kashkari says softer inflation data don’t change Fed’s path. Inflation has eased but it’s ‘unacceptably high,’ Evans says.

U.S. Home Inventory Grew at Record Pace in July
However, new listings slowed, indicating some potential sellers are on the fence.

The Snowballing US Rental Crisis Is Sparing Nowhere and No One
Renters across cities and income brackets are struggling to find new homes or pay for the ones they already live in.

US Consumer Borrowing Jumps by More Than $40 Billion, Second-Most Ever
Increase led by a record increase in non-revolving borrowing. Vehicle loans rose about $32 billion in second quarter.

Economic Data Results for 8-11-2022
United States Producer Price Inflation MoM
Producer prices in the US unexpectedly fell 0.5% month-over-month in July of 2022, following a downwardly revised 1% rise in June and beating market forecasts of a 0.2% increase. It is the first decline in the PPI in over two years, mostly due to a 16.7% drop in gasoline prices.

United States Producer Prices Change YoY
Annual producer inflation in the US slowed to 9.8% in July of 2022, the lowest since October, and beating market forecasts of 10.4%. It compares with an 11.3% reading in June.

The producer price index for final demand less foods and energy in the United States rose 0.2 percent from a month earlier in June of 2022, easing from a 0.4 percent gain in the prior month and below market estimates of a 0.4 percent increase.

The producer price index for final demand less foods and energy in the United States rose by 7.6 percent from a year earlier in June of 2022, easing from an 8.2 percent increase in the prior month and mostly in line with analysts' expectations. It was the lowest reading since last October.

Economic Data Due Tomorrow on 8-12-2022
Michigan 5 Year Inflation Expectations Prel AUG

Michigan Inflation Expectations Prel AUG

Michigan Consumer Expectations Prel AUG

Michigan Consumer Sentiment Prel AUG


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