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Economy in Brief

U.S. PPI Falls Again but Core Price Increase Firms
by Tom Moeller  November 21, 2013

The Producer Price Index for finished goods matched expectations and declined 0.2% last month (+0.3% y/y) following a 0.1% September slip. Prices excluding food & energy rose 0.2% in October (1.4% y/y), the quickest rise since June. Expectations had been for a 0.1% uptick.

Food prices firmed by 0.8% (1.7% y/y), the largest gain since March. Fresh and dry vegetables prices surged by one-half y/y while bakery product prices rose 3.3% y/y. Beef & veal prices rose 0.9% y/y but dairy product costs fell 0.9% y/y). Energy prices fell 1.5% (-3.4% y/y). The decline was led by a 3.8% fall (-11.3% y/y) in gasoline prices and a 1.0% decline (-2.1% y/y) in home heating oil costs. Natural gas prices slipped 0.6% (+6.7% y/y).

Finished consumer goods prices excluding food & energy edged up 0.1% (1.7% y/y). Consumer durable goods prices gained 0.1% (0.8% y/y) but passenger car prices jumped 1.7% (1.0% y/y). Core consumer nondurable goods prices rose 0.2% (2.3% y/y). Capital equipment prices increased 0.1% (1.0% y/y).

Intermediate goods prices fell 0.4% (-0.8% y/y) led by a 1.2% decline (-5.0% y/y) in energy costs. Intermediate food prices were off 1.5% (-3.4% y/y). Prices excluding food & energy slipped 0.1% (+0.8% y/y). Crude goods prices declined 0.9% (-0.4% y/y) led by a 2.9% shortfall (+2.2% y/y) in energy prices. Working the other way, crude food prices rose 1.2% (-5.1% y/y). Crude goods prices excluding food & energy fell 0.5% (-5.1% 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 2012 2011 2010
Finished Goods -0.2 -0.1 0.3 0.3 1.9 6.0 4.2
  Less Food & Energy 0.2 0.1 0.0 1.4 2.6 2.4 1.2
    Foods 0.8 -1.0 0.6 1.7 2.6 6.3 3.9
    Energy -1.5 0.5 0.8 -3.4 -0.2 15.5 13.5
Intermediate Goods -0.4 0.1 0.0 -0.8 0.5 9.0 6.4
  Less Food & Energy -0.1 0.1 0.2 0.8 0.3 6.2 4.3
Crude Goods -0.9 0.5 -2.7 -0.4 -3.3 17.4 21.3
  Less Food & Energy -0.5 -1.0 -0.4 -5.1 -5.2 18.5 32.5
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