The cost of doing business. Going up.

PPI surged 9.7% last month, off only slightly from December’s 12-year high.

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Less than a week after a record rise in the CPI comes the PPI, or Producer Price Index. It’s rough. PPI measures inflation at the wholesale level before it reaches consumers—and it surged 9.7% last month, off only slightly from December’s 12-year high.

Vicious cycle. Costs of producing goods continues to rise, so many businesses are forced to raise prices. It also adds more pressure on a Fed decision in March to raise rates to pump the economic brakes to curb demand.

Consumer confidence is already at an 11-year low. 1/3 of consumers report an impact on personal finances while almost half expect declines in their overall income because of inflation’s bite—even with increases in salary or hourly wages. On an annual basis, real earnings actually declined 1.7% in January.

I’m Dave Spano from Annex Wealth Management. That is your Know the Difference Minute.