US producer prices rise 5.4% annually, slightly above forecasts

• The previous annual figure was 4.7%, later revised to 4.8%
• On a monthly basis, final demand PPI increased 0.4%, matching expectations
• The prior monthly reading was 0.0%, revised up to +0.1%
• Excluding food and energy, the yearly rate stood at 4.6%, in line with the forecast
• That core measure was previously 4.2% y/y, revised to 4.3%
• The monthly core reading, excluding food and energy, came in at 0.2%, below the 0.3% estimate
• A broader measure excluding food, energy and trade services rose 4.7% month-over-month, matching the prior period
• That same measure was up 0.3% from the previous month, compared with a prior gain of 0.4%

After revisions, the data represents a minor positive surprise. However, with the Federal Reserve closely watching inflation figures this week, the report carries weight, and the dollar has strengthened in response. Fed funds futures now indicate a 64% probability of a rate hike this month, although a portion of that move is attributed to rising oil prices for an eighth consecutive day.