U.S. December PPI First Take

In December, the U.S. PPI increased by 3% year-on-year, exceeding the expected value of 2.8%, with the previous value at 3%; the U.S. core PPI in December rose by 3.3% year-on-year, higher than the expected value of 2.9%, with the previous value revised from 3% to 3.1%. The significant rise in service costs was the main factor driving the December PPI above expectations. Data shows that the trade profit margin indicator experienced its largest increase since mid-2024, with the rise in wholesale profit margins for machinery and equipment contributing most of the increase in this category. In contrast, commodity prices remained unchanged in December, ending the upward trend of the previous month. This divergence indicates that current wholesale inflation pressures are primarily concentrated in the service sector rather than in physical goods