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Producer Price Index advanced 0.4% in October, ex Fd & Engy up 0.2%
The Producer Price Index for final demand increased 0.4 percent in October, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.4 percent in September and 0.2 percent in August. On an unadjusted basis, the final demand index increased 2.8 percent for the 12 months ended in October, the largest rise since an advance of 2.8 percent for the 12 months ended February 2012.
Within final demand in October, prices for final demand services rose 0.5 percent, and the index for final demand goods moved up 0.3 percent. Prices for final demand less foods, energy, and trade services rose 0.2 percent in October. For the 12 months ended in October, the index for final demand less foods, energy, and trade services advanced 2.3 percent.
Final demand services: The index for final demand services rose 0.5 percent in October, the largest increase since moving up 0.5 percent in April. Three-quarters of the October advance can be traced to a 1.1-percent rise in margins for final demand trade services. (Trade indexes measure changes in margins received by wholesalers and retailers.) The index for final demand transportation and warehousing services increased 0.8 percent. Prices for final demand services less trade, transportation, and warehousing edged up 0.1 percent.
Product detail: Nearly half of the increase in prices for final demand services can be attributed to margins for fuels and lubricants retailing, which surged 24.9 percent. The indexes for machinery and equipment wholesaling; transportation of passengers (partial); apparel, jewelry, footwear, and accessories retailing; chemicals and allied products wholesaling; and portfolio management also advanced. In contrast, margins for food retailing moved down 2.1 percent. The indexes for food and alcohol wholesaling and for loan services (partial) also decreased.
Final demand goods: Prices for final demand goods moved up 0.3 percent in October, the third straight increase. Over two-thirds of the October rise can be traced to the index for final demand goods less foods and energy, which advanced 0.3 percent. Prices for final demand foods moved up 0.5 percent. The index for final demand energy was unchanged.
Product detail: Almost half of the rise in the final demand goods index was the result of higher prices for pharmaceutical preparations, which increased 2.1 percent. The indexes for industrial chemicals, fresh and dry vegetables, diesel fuel, beef and veal, and tobacco products also advanced. Conversely, prices for gasoline fell 4.6 percent. The indexes for light motor trucks and pork also moved lower. (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 2018 Model Vehicles, at www.bls.gov/web/ppi/ppimotveh.htm.)
Posted: November 14, 2017 Tuesday 08:30 AM