PPI Vs CPI: Are Record Profit Margins About To Get Squeezed?

What happened: Producer prices rose 6.3% in the year to September 2026 while consumer prices rose 3.7%, leaving a 2.6-point PPI vs CPI gap that reflects costs companies are absorbing rather than passing on. Key numbers: PPI +6.3% year over year, largest monthly gain 1.3% since March 2022; CPI +3.7%; processed goods for Why it matters: The content states that in four of six past episodes since 1950 when producer inflation outpaced consumer inflation by 4 points or more, the profit share of GDP fell 1 to 4.4 points within two years, while analysts expect margins to hold near records.

Producer prices rose 6.3% in the year to September 2026 while consumer prices rose 3.7%, leaving a 2.6-point PPI vs CPI gap that reflects costs companies are absorbing rather than passing on.

The content states that in four of six past episodes since 1950 when producer inflation outpaced consumer inflation by 4 points or more, the profit share of GDP fell 1 to 4.4 points within two years, while analysts expect margins to hold near records.