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Thursday, October 14, 2021

Producer price inflation not as hot as expected, jobless claims fall below 300,000 mark

The Producer Price Index (PPI) showed prices at the wholesale level in September rose 0.5% month-over-month (m/m), below the Bloomberg consensus estimate calling for a 0.6% gain, and south of August's 0.7% increase. 

The core rate, which excludes food and energy, gained 0.2% m/m, below estimates of a 0.5% rise and the prior month's 0.6% gain. Y/Y, the headline rate was 8.6% higher, just shy of projections of an 8.7% increase and compared to August's 8.3% gain. The core PPI increased 6.8% y/y last month, south of estimates calling for a 7.1% rise, and following August's 6.7% increase.

Weekly initial jobless claims came in at a level of 293,000 for the week ended October 9, versus estimates of 320,000 and compared to the prior week's upwardly-revised 329,000 level. The four-week moving average fell by 10,500 to 334,250, and continuing claims for the week ended October 2 dropped by 134,000 to 2,593,000, below estimates of 2,670,000. 

The four-week moving average of continuing claims fell by 30,500 to 2,737,750.

The yield on the 2-year note is declining 2 basis points (bps) to 0.35% and the yield on the 10-year note is dipping 1 bp to 1.54%, while the 30-year bond rate is ticking 1 bp higher to 2.05%.

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