AI Data Insight
The US December final demand PPI recorded a year-on-year increase of 2.9%, slightly down from the previous reading of 3.0% but significantly higher than market expectations of 2.6%. Data shows that declines in commodity prices such as gasoline offset some gains; however, a sharp rise in service sector margins caused core inflation to remain high (3.6%), forcing the market to reassess the Federal Reserve's easing path for 2026, with expectations for the pace of rate cuts becoming more cautious.