Recent Updates

  • UK: **Retail Sales rebased to 2016=100**
  • Ireland: **GDP Rereferenced to Chained 2016 Euros**
  • New Zealand: External Migration (Jun)
  • Korea: PPI, Domestic Supply Price and Total Output Price Indexes (Jun); India: International Banking Statistics (2017)
  • US: Composite Indexes (Jun)
  • Canada: Employment Insurance (May), Nonres Building Construction (Q2)
  • US: Philadelphia Fed Business Outlook (Jul)
  • more updates...

Economy in Brief

U.S. Producer Prices Rise; Core Prices Strengthen
by Tom Moeller  August 17, 2011

The U.S. producer price index for finished goods increased 0.2% last month after a 0.4% June decline. The figure compared to Consensus expectations for no change. The change in energy and food prices offset one another. However, excluding these two components, there was evidence of price strength. The 0.4% increase in the core PPI was the strongest monthly increase since January and was twice expectations. Moreover, the 2.5% twelve-month increase was double last year's rise.

Finished consumer goods prices ticked up 0.1% (9.0% y/y) with the rise held back by lower energy prices. Conversely, food prices rose a strong 0.6% (7.1% y/y). Outside of energy & food, pricing power strengthened with a 0.4% m/m rise (2.5% y/y). Within the components, women apparel prices rose 1.3% y/y after last year's 0.5% y/y decline and men's apparel costs jumped 3.7% y/y after a 0.3% annual uptick. Textile furnishings prices jumped 7.8% y/y, adding to last year's 2.0% increase, but household furnishings prices rose 1.7%, up from 0.3%. Passenger car prices reversed last year's 1.4% decline and tobacco prices rose by a stable and strong 6.2% y/y. Capital goods prices rose 0.4% and by 1.8% y/y after a 0.4% gain in 2010.

The energy price decline reflected a 2.8% (+41.7% y/y) drop in gasoline and a 1.5% decline (+45.8% y/y) in home heating oil. Electric power costs rose 1.2% (1.4% y/y). Food prices again rose a strong 0.6% (7.1% y/y) led by the 19.4% rise in prices for eggs and the 14.1% rise in beef. Dairy prices also posted a firm 17.5% y/y gain though vegetable prices declined 6.4%.

Intermediate goods prices rose 0.2% as energy prices increased 0.4% (+24.6% y/y) and food prices ticked up 0.1% (14.7% y/y). Core-intermediate prices rose a lessened 0.2% (7.8% y/y). Crude materials prices fell another 1.2% as energy prices dropped 2.6% (+14.1% y/y) and food prices slipped 0.8% (+27.3% y/y). However, prices less food & energy were strong again, up 0.7%. Strength in aluminum as well as iron & steel scrap prices continued with a one-quarter y/y rise and copper prices rose by one-third.

The PPI data are contained in Haver's USECON database with further detail in PPI and PPIR. The expectation figure is available in the AS1REPNA database.

Producer Price Index (%) Jul Jun May Jul Y/Y 2010 2009 2008
Finished Goods 0.2 -0.4 0.2 7.2 4.2 -2.5 6.4
  Energy -0.6 -2.8 1.5 20.4 13.8 -17.7 14.1
  Food 0.6 0.6 -1.4 7.1 3.9 -1.4 6.8
  Less Food & Energy 0.4 0.3 0.2 2.5 1.2 2.5 3.4
Intermediate Goods 0.2 0.0 0.9 11.8 6.4 -8.4 10.3
  Less Food & Energy 0.2 0.3 0.9 7.8 4.3 -4.2 7.4
Crude Materials -1.2 -0.6 -4.1 22.2 21.4 -30.3 21.5
  Less Food & Energy 0.7 1.1 -0.9 27.0 32.6 -23.4 14.7
close
large image