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Economy in Brief

U.S. PPI Moves Upward With Energy and Food Prices
by Tom Moeller  June 14, 2013

The deflation of wholesale prices ended last month. The producer price index for finished goods recovered 0.5% in May (1.8% y/y) following an unrevised 0.7% April drop. The increase exceeded consensus expectations for a 0.1% uptick. Prices excluding food & energy notched up an expected 0.1% (1.6% y/y), the same as during April. Higher energy prices led the increases in overall prices with a 1.3% gain (0.9% y/y). Gasoline prices rebounded by  1.5% (-2.4% y/y) while home heating oil prices also reversed course with a 4.9% rise (-8.8% y/y). Residential gas prices gained another 4.0% (18.3% y/y). Reinforcing the energy price advances was a 0.6% rebound (3.1% y/y) in food prices. Egg prices soared 41.6% (38.8% y/y) while beef costs recovered 1.0% (1.0% y/y).

Finished consumer goods prices gained 0.6% (3.1% y/y) but, excluding food & energy, they ticked up 0.1% (2.3% y/y) as in April. Within the components, women's clothing costs increased 1.7% y/y while men's apparel prices rose 1.9% y/y. Furniture prices rose 1.5% y/y and household appliance prices slipped 0.3% y/y. Passenger car prices declined 0.8% y/y. Capital equipment prices rose edged up a steady 0.1% (0.9% y/y).

Intermediate goods prices slipped 0.1% (-0.2% y/y) as energy costs declined 2.1% (-4.7% y/y). Food prices were off 0.9% (+3.5% y/y) while core intermediate prices fell 0.4% (-0.2% y/y). Crude goods prices recovered 2.2% last month (7.7% y/y) reflecting a 5.0% rise (16.2% y/y) in energy costs and a 2.1% gain (9.6% y/y) in food prices. Prices excluding food & energy fell 2.3% (-6.3% 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 (%) May Apr Mar May Y/Y 2012 2011 2010
Finished Goods 0.5 -0.7 -0.6 1.8 1.9 6.0 4.2
  Less Food & Energy 0.1 0.1 0.2 1.6 2.6 2.4 1.2
    Foods 0.6 -0.8 0.9 3.1 2.6 6.3 3.9
    Energy 1.3 -2.5 -3.4 0.9 -0.2 15.5 13.5
Intermediate Goods -0.1 -0.6 -0.9 -0.2 0.5 9.0 6.4
  Less Food & Energy -0.4 -0.2 0.2 -0.2 0.3 6.2 4.3
Crude Goods 2.2 -0.4 -2.5 7.7 -3.2 17.4 21.3
  Less Food & Energy -2.3 -2.8 0.9 -6.3 -5.2 18.5 32.5
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