The producer price index for May came in at a monthly gain of 0.8% when stripping out food, energy, and trade, the fastest pace at that level since 2022. On a year-over-year basis, producer prices are up 5.1%. Megan Horneman breaks down what the numbers actually mean and why they matter beyond the headlines.

In this episode, Megan covers:

- Why the core PPI reading of 0.8% month-over-month is the number that matters more than the headline
- Which components from PPI will filter into the Fed's preferred inflation gauge, PCE
- How portfolio management fees and healthcare costs are contributing to the upcoming PCE read
- What it means that upstream business costs are rising but have not yet shown up fully at the consumer level
- What to watch for from new Fed Chair Kevin Warsh at next week's FOMC meeting
- Why markets bounced today despite ongoing geopolitical uncertainty

If you are trying to make sense of where inflation really stands and what the Fed is likely to do next, this episode gives you a five-minute read on both.

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For a history of all Markets with Megan episodes, visit: https://marketswithmegan.FM

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