PPI: What the Numbers Really Say

The Fog of War: Inflation's Murky Signal Amidst Missing Data

The latest Producer Price Index (PPI) numbers for September finally trickled out, a delayed dispatch from the economic front lines, but what they reveal isn't clarity. Instead, we’re left peering through a thick haze, trying to discern the true state of inflationary pressures and consumer resilience. It’s like trying to navigate a battlefield with half your intelligence reports missing, or worse, deliberately withheld.

The Bureau of Labor Statistics (BLS) dropped these figures on a Tuesday, November 25, 2025, a date that itself speaks volumes. September data in late November? That's not real-time intelligence; that’s an autopsy report. And the situation only gets murkier when you consider the BLS has already pulled the plug on the October Consumer Price Index (CPI) report and might do the same for October PPI. We’re being asked to make sense of the economic landscape while key instruments are offline.

Reading the Tea Leaves in a Data Vacuum

Let's parse the numbers we do have. September’s headline PPI nudged up 0.3% on the month, exactly what the Dow Jones consensus was braced for. But dig a bit deeper, and the picture quickly shifts. Core PPI, which strips out the volatile food and energy components, only managed a meager 0.1% increase, falling short of the 0.2% estimate, as reported by Core wholesale prices rose less than expected in September; retail sales gain. This isn't a minor discrepancy; it suggests the underlying inflationary pulse isn’t as strong as the headline might imply.

The primary engine of that 0.3% overall PPI bump? Goods prices, which surged 0.9%—the largest jump we’ve seen since February 2024. And within that, it’s a story of commodities: final demand energy prices exploded by 3.5%, with gasoline alone spiking 11.8%. Food prices also got in on the act, rising 1.1%. Services, on the other hand, largely flatlined. While transportation and warehousing costs did climb 0.8%, and airline passenger fees actually surged 4%, the broader services sector didn’t show the same inflationary heat. This isn’t a broad-based inflation problem; it’s a specific, commodity-driven pressure point, concentrated heavily in energy.

Now, let's turn to the consumer. Retail sales for September increased a modest 0.2%, slightly softer than the 0.3% forecast, according to Soft Retail Sales, Weak ADP Jobs Data May Shape Fed (Live). Ex-autos, sales were up 0.3%, hitting the estimate right on the nose. So, the consumer isn’t exactly on a spending spree. My analysis suggests a subtle but significant shift in where discretionary dollars are going. Gas stations saw a 2% bump, which makes sense given the gasoline price surge, and eating and drinking establishments eked out a 0.7% gain. But consumers pulled back on things like sporting goods and hobby stores (-2.5%) and online sales (-0.7%). This tells me people are paying more for essentials and perhaps small indulgences, but they're tightening their belts on other discretionary purchases. It’s a classic trade-off when household budgets feel the squeeze.

The Gaps in the Picture

This is where my skepticism really kicks in. We’re given these September figures, delayed by a government shutdown (a detail often swept under the rug), but we're simultaneously told that October CPI is canceled and October PPI might follow suit. How are we supposed to make informed decisions—whether you're a central banker, an investor, or just trying to budget your household—when the most critical gauges are missing? It’s like a pilot trying to land a plane in zero visibility, with half the cockpit instruments malfunctioning. The risk of miscalculation becomes exponentially higher.

I've looked at hundreds of these filings, and this particular data cancellation is more than just an inconvenience; it’s a systemic breakdown in economic visibility. We’re seeing a commodity-driven inflation impulse in September’s PPI, but without October’s CPI, we can’t tell if that translated into broader consumer price increases, or if it was a transient blip. Was that 11.8% gasoline surge a one-off, or did it persist? We simply don’t know. This lack of continuity, this sudden void in the data stream, creates a massive information asymmetry.

What does it mean for the Federal Reserve, for instance? Their entire mandate hinges on managing inflation and employment, yet they’re operating with a significant portion of their inflation data effectively redacted. How do you assess the efficacy of past policy, or chart a course for future action, when you’re flying blind? Are they to assume the September PPI trend continued, or did it fizzle out? The market hates uncertainty, and right now, the BLS is serving up a generous helping of it. The questions pile up faster than the data can be released: How much of this September bump is genuine momentum, and how much is merely a delayed echo of past pressures? What does this mean for the Fed's next move when they’re essentially operating on guesswork for October and maybe even November?

Economic Visibility: A Luxury, Not a Given