Wholesale inflation was uncomfortably warm in May, the BLS said, in Thursday’s only notable US macro update.

The headline PPI gain was 1.1%, far quicker than the 0.7% consensus expected. April’s MoM pace was revised to show a similar monthly advance, down from an initially-reported 1.4% sequential gain.

Back-to-back >1% monthly factory-gate inflation readouts are a bitter pill, but as ever, economists (and to a lesser extent, investors) will focus on the PPI components that feed into PCE prices, the Fed’s preferred inflation measure.

As the figure above shows, the YoY pace for the headline final demand gauge is now 6.5%, the highest since November of 2022.

Notably, if not surprisingly, the energy gauge posted another enormous gain, rising 10.7% MoM.

That was actually faster than March’s advance, and accounted for 80% of what looked like the largest monthly gain for the goods gauge on record.

There’s the chart. Final demand goods prices rose 2.8% in May from April. The series goes back to December of 2009.

The food gauge also posted a sharp monthly advance. Stripping out energy and food, goods prices still rose, and not by a little: 0.8% from April to May.

The cost of transportation and warehousing, which has risen in connection with the war, jumped again, this time by 2.6%, slower than the 3.8% recorded in April, but faster than March’s monthly pace.

The core PPI gauge rose 0.4% MoM and 4.9% YoY, both slightly cooler than expected.

Whatever this release says or doesn’t say about inflation as measured by PCE prices (some of those components weren’t exactly tame either), it certainly isn’t the stuff good press is made of. The optics are bad for The White House.

What can you say? “I love it,” I guess.