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Producer Price Index rose 0.3% in October, ex Fd & Engy up 0.2%
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The Producer Price Index for final demand advanced 0.3 percent in October, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices rose 0.4 percent in September and 0.3 percent in August. On an unadjusted basis, the final demand index increased 0.5 percent for the 12 months ended in October, the largest advance since moving up 1.1 percent for the 12 months ended in February.
In October, nearly 60 percent of the rise in the final demand index can be traced to a 0.5-percent increase in prices for final demand goods. The index for final demand services moved up 0.2 percent.
The index for final demand less foods, energy, and trade services advanced 0.2 percent in October, the sixth consecutive increase. For the 12 months ended in October, prices for final demand less foods, energy, and trade services rose 0.8 percent, the largest advance since moving up 1.0 percent for the 12 months ended in March.
Final Demand
Final demand goods: The index for final demand goods increased 0.5 percent in October, the sixth consecutive rise. Nearly three-fourths of the October advance is attributable to prices for final demand foods, which jumped 2.4 percent. The index for final demand energy moved up 0.8 percent. Prices for final demand goods less foods and energy were unchanged.
Product detail: In October, a major factor in the increase in prices for final demand goods was the index for fresh and dry vegetables, which rose 26.8 percent. Prices for gasoline, meats, chicken eggs, and thermoplastic resins and materials also moved higher. In contrast, the residential electric power index fell 1.0 percent. Prices for light motor trucks, packaged fluid milk and related products, and passenger cars also decreased. (In accordance with usual practice, most new-model-year passenger cars and light motor trucks were introduced into the PPI in October. See Report on Quality Changes for 2021 Model Vehicles at www.bls.gov/web/ppi/ppimotveh.htm.)
Final demand services: The index for final demand services rose 0.2 percent in October after advancing 0.4 percent in September. Nearly 40 percent of the broad-based October increase can be traced to prices for final demand transportation and warehousing services, which moved up 1.1 percent. The indexes for final demand trade services and final demand services less trade, transportation, and warehousing also advanced, 0.2 percent and 0.1 percent, respectively. (Trade indexes measure changes in margins received by wholesalers and retailers.)
Product detail: Over a quarter of the advance in the index for final demand services can be traced to prices for long-distance motor carrying, which rose 1.9 percent. The indexes for hardware, building materials, and supplies retailing; securities brokerage, dealing, and investment advice; automotive fuels and lubricants retailing; hospital inpatient care; and automobile retailing (partial) also moved higher. Conversely, margins for chemicals and allied products wholesaling fell 2.6 percent. The indexes for gaming receipts (partial) and physician care also decreased.
Posted: November 13, 2020 Friday 08:30 AM