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Economy in Brief

U.S. PPI Backpedals With Lower Energy Prices
by Tom Moeller  November 14, 2012

The producer price index for finished goods fell 0.2% last month. The decline followed four months of increase and contrasted with expectations for a 0.2% rise. Excluding food & energy prices also fell 0.2% versus expectations for a 0.2% increase. Lower energy prices paced last month's decline with a 0.5% (+3.1% y/y) drop. That reflected a 3.3% (+2.7% y/y) decline in home heating oil costs and a 2.2% (+9.5% y/y) easing in gasoline prices. Higher food prices offset these declines with a 0.4% (2.2% y/y) increase, the fifth consecutive month of gain.

Finished consumer goods prices slipped 0.1% (+2.7% y/y). Excluding food & energy, consumer goods prices fell 0.3% (+2.6% y/y). Within the components, men's apparel prices rose 3.5% y/y while women's clothing costs increased 0.5% y/y. Household appliance prices gained 5.1% since October of 2011, furniture prices rose 2.2% y/y and passenger car prices increased 0.2% y/y. Capital equipment prices fell 0.3% last month (+1.4% y/y).

Intermediate goods prices slipped 0.1% (+0.8% y/y) as energy costs fell 0.6% (+2.3% y/y) following two months of strong increase. Food prices gained 0.7% (7.5% y/y) following three months of notable gain but energy prices slipped 0.6% (+2.3% y/y). Core-intermediate prices were unchanged (-0.5% y/y. Crude goods prices gained 0.9% (-0.0% y/y) last month bolstered by a 1.9% (9.2% y/y) jump in food prices and a 1.3% (-4.8% y/y) rise in energy prices. Prices excluding food & energy fell 1.4% (-5.9% y/y). 

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

 

Producer Price Index (%) Oct Sep Aug Oct Y/Y 2011 2010 2009
Finished Goods -0.2 1.1 1.7 2.3 6.0 4.2 -2.5
 Less Food & Energy -0.2 0.0 0.2 2.1 2.4 1.2 2.6
  Foods 0.4 0.2 0.9 2.2 6.3 3.9 -1.4
  Energy -0.5 4.7 6.4 3.1 15.7 13.6 -17.6
Intermediate Goods -0.1 1.5 1.1 0.8 9.1 6.4 -8.4
 Less Food & Energy 0.0 0.6 -0.2 -0.5 6.2 4.3 -4.2
Crude Goods 0.9 2.8 5.8 -0.0 17.4 21.4 -30.3
 Less Food & Energy -1.4 1.6 2.2 -5.9 18.5 32.5 -23.3
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