Global| Sep 10 2004Finished Producer Prices Decline
by:Tom Moeller
|in:Economy in Brief
Summary
The finished goods PPI fell 0.1% in August versus Consensus expectations for a 0.2% rise.Producer prices less food & energy also declined 0.1% versus expectations for a 0.1% gain. Finished energy prices inched just 0.2% higher (10.0% [...]
The finished goods PPI fell 0.1% in August versus Consensus expectations for a 0.2% rise.Producer prices less food & energy also declined 0.1% versus expectations for a 0.1% gain.
Finished energy prices inched just 0.2% higher (10.0% y/y) following a 2.3% advance in July. Gasoline prices fell a not seasonally adjusted 5.1% m/m (+20.6% y/y) and residential gas prices rose 0.1% (8.8% y/y).
Prices of finished consumer goods less food & energy fell 0.2% (1.6% y/y).
Finished capital goods prices fell 0.1% (1.4% y/y).
More fireworks were provided in the report that crude prices less food & energy rose 4.5% on top of an 8.6% July increase. During the last thirty years "core" crude prices have been a fair indicator of activity in the industrial sector. There has been a 51% correlation between the six month change in core crude prices and the change in factory sector industrial production.
Intermediate goods prices were strong again showing a 1.0% gain following a 0.8% rise in July. Core intermediate prices doubled the July increase with a 1.0% spurt in August that reflected a 5.7% (NSA, 19.5% y/y) m/m jump in industrial chemical prices.
| Producer Price Index | Aug | July | Y/Y | 2003 | 2002 | 2001 |
|---|---|---|---|---|---|---|
| Finished Goods | -0.1% | 0.1% | 3.4% | 3.2% | -1.3% | 2.0% |
| Core | -0.1% | 0.1% | 1.5% | 0.2% | 0.1% | 1.4% |
| Intermediate Goods | 1.0% | 0.8% | 8.1% | 4.7% | -1.5% | 0.4% |
| Core | 1.0% | 0.5% | 7.3% | 2.0% | -0.5% | -0.1% |
| Crude Goods | -0.7% | -0.2% | 22.4% | 25.1% | -10.6% | 0.3% |
| Core | 4.5% | 8.6% | 32.1% | 12.4% | 3.8% | -10.0% |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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