The latest data on producer prices are set for release at 8:30 a.m. ET.
Economists estimate that the producer price index (PPI) for final demand fell 0.2% month-on-month in January, and dropped 0.6% year-over-year, according to Bloomberg.
Excluding fluctuating food and energy costs, they forecast producer prices rose 0.1% compared to December, and increased 0.4% against the prior year.
The PPI data look at inflation from the producers' perspective, and are used as a forward-looking indicator for consumer prices, since sellers would likely pass their higher costs to buyers through more expensive items on shelves.
In a client note Tuesday, Deutsche Bank's Joe LaVorgna noted that healthcare costs are worth paying attention to in this report "since this series is used to calculate the medical care component of the PCE deflator, the Fed's preferred inflation metric."
"Seasonally adjusted PPI healthcare costs increased in October, November and December, thereby taking its year-over-year rate up to 1.1%," he wrote. "While still extremely low, this was the highest annual growth rate of healthcare inflation since September 2014 (1.4%) ... If healthcare costs continue to trend higher, the growth rate of the core PCE deflator, currently 1.4%, is likely to move up because medical has the largest weight within the index (roughly 20%).
Inflation is still shy of the Fed's 2% target.
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