Given the stock market rally and rise in Treasury yields we have seen since the election, many economists and investors probably are not paying too much attention to economic reports that cover October and prior months. But what if one of those reports of pre-election time periods implied that the bump in inflation seen in recent months was already coming back down?

The U.S. Department of Labor has released its producer price index (PPI) for final demand, and the headline monthly reading was flat at 0.0%. Bloomberg had been calling for a gain of 0.3%, the same as the September headline PPI report.

Then there is the core reading of PPI, which excludes food and energy with the aim of smoothing out volatility. This core reading went in the red zone here in October: −0.2%. Bloomberg called for a reading of 0.2%, consistent with the September reading.

Where things get more comparable and more important is on the annualized, year-over-year numbers. Headline PPI was up 0.8% in October, versus 0.7% in September. The core PPI reading (again, without food and energy) was up 1.2%.

Then there is the newer measurement for a true core reading that excludes food, energy and trade services. This deeper core reading was −0.1% in October’s monthly reading (versus a positive 0.3% in September) and was 1.6% on the year-over-year reading (versus a positive 1.5% in September).

If you break these down in non-numeric terms, the issue is that weak food and services costs acted to offset energy gains. Wholesale food prices were −0.8% in October, confirming the food deflation that grocery store executives have been discussing. Service prices were −0.3%, while energy prices were up by 2.5%, after a gain or more than 9% in gasoline.

Again, this is an October reading. It does not include the massive post-election rally and does not even include the potential bump in more spending and higher sentiment that is being seen in more live November readings.

After five straight days of a rally, and after one-hour of trading on Wednesday, the Dow was down 59 points and the S&P 500 was down four points. The yield on the 10-year Treasury yield is 2.24%, and the yield on the 30-year was last seen at 2.94%.

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