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Producer Price Index rose 0.6% in October, ex Fd & Engy up 0.5%
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The Producer Price Index for final demand increased 0.6 percent in October, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices moved up 0.5 percent in September and 0.7 percent in August. (See table A.) On an unadjusted basis, the final demand index rose 8.6 percent for the 12 months ended in October.
Over 60 percent of the October increase in the index for final demand can be traced to a 1.2-percent rise in prices for final demand goods. The index for final demand services moved up 0.2 percent, and prices for final demand construction advanced 6.6 percent.
Prices for final demand less foods, energy, and trade services moved up 0.4 percent in October after increasing 0.1 percent in September. For the 12 months ended in October, the index for final demand less foods, energy, and trade services rose 6.2 percent.
Final Demand
Final demand goods: The index for final demand goods moved up 1.2 percent in October following a 1.3-percent increase in September. In October, three-quarters of the advance can be attributed to a 4.8-percent jump in prices for final demand energy. The index for final demand goods less foods and energy moved up 0.5 percent. Conversely, prices for final demand foods decreased 0.1 percent.
Product detail: One-third of the October advance in the index for final demand goods can be traced to prices for gasoline, which rose 6.7 percent. The indexes for diesel fuel, fresh and dry vegetables, gas fuels, jet fuel, and plastic resins and materials also moved higher. In contrast, prices for beef and veal decreased 10.3 percent. The indexes for light motor trucks and for residential electric power also fell. (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 2022 Model Vehicles at www.bls.gov/web/ppi/ppimotveh.htm.)
Final demand services: Prices for final demand services moved up 0.2 percent in October, the tenth consecutive advance. Nearly two-thirds of the increase in October can be attributed to the index for final demand trade services, which rose 0.4 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.) Prices for final demand transportation and warehousing services advanced 1.7 percent. Conversely, the index for final demand services less trade, transportation, and warehousing fell 0.1 percent.
Product detail: Over 80 percent of the October increase in prices for final demand services can be traced to margins for automobiles and automobile parts retailing, which rose 8.9 percent. The indexes for apparel, footwear, and accessories retailing; truck transportation of freight; food and alcohol retailing; hospital outpatient care; and machinery and equipment parts and supplies wholesaling also moved up. In contrast, prices for securities brokerage, dealing, investment advice, and related services fell 6.6 percent. The indexes for fuels and lubricants retailing and for portfolio management also declined.
Posted: November 9, 2021 Tuesday 08:30 AM