Global| May 11 2012U.S. PPI Declines But Core Remains Firm
by:Tom Moeller
|in:Economy in Brief
Summary
The producer price index for finished goods fell 0.2% during April following an unrevised no-change in March. Consensus expectations were for prices to remain unchanged. Core pricing power continued to firm with the economy's [...]
The producer price index for finished goods fell 0.2% during
April following an unrevised no-change in March. Consensus expectations
were for prices to remain unchanged. Core pricing power continued to firm
with the economy's recovery. The PPI less food & energy matched
expectations and rose 0.2% after March's 0.3% rise. The y/y gain of 2.7%
compared to 2.4% during all of last year and 1.2% in 2010.
A 1.4% decline (-0.6% y/y) in energy prices accounted for the unchanged PPI last month. Gasoline prices fell 1.7% (+1.9% y/y) while home heating oil costs dropped 3.4% (+1.3% y/y). Also falling were residential gas prices by 3.1% (-13.6% y/y) but electricity costs rose 0.3% (0.8% y/y). Food prices continued upward by 0.2% (2.5% y/y) reflecting a 17.3% spike in fresh eggs (-10.5% y/y) and a 4.3% surge in beef & veal (7.8% y/y).
Finished consumer goods prices fell 0.3% (+1.9% y/y) after a 0.1% March slip. Less food & energy, consumer goods prices rose 0.2% (3.3% y/y). Within the components, men's apparel prices rose 8.5% y/y while women's clothing costs increased just 1.1% y/y. Household appliance prices rose 4.3% since April of 2011 and passenger car prices rose an increased 1.2% y/y. Capital equipment prices rose again by 0.2% last month and by a steady 2.0% year-to-year.
Intermediate goods prices fell 0.5% (+1.0% y/y) with the drop in energy prices. Energy costs were off 2.7% last month, unchanged y/y, while food prices rose 0.4% (1.9% y/y). Core-intermediate prices rose 0.2% and by a reduced 1.4% y/y. Crude materials prices fell 4.4% last month and were down 7.6% year-to-year. Energy prices declined 6.8% (-16.3% y/y) while food prices were off 3.5% (-1.2% y/y). Prices less food & energy eased 1.8% and were down 3.6% versus last year.
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 (%) | Apr | Mar | Feb | Apr Y/Y | 2011 | 2010 | 2009 |
|---|---|---|---|---|---|---|---|
| Finished Goods | -0.2 | 0.0 | 0.4 | 1.9 | 6.0 | 4.2 | -2.5 |
| Less Food & Energy | 0.2 | 0.3 | 0.2 | 2.7 | 2.4 | 1.2 | 2.6 |
| Food | 0.2 | 0.2 | -0.1 | 2.5 | 6.3 | 3.9 | -1.4 |
| Energy | -1.4 | -1.0 | 1.3 | -0.6 | 15.7 | 13.6 | -17.6 |
| Intermediate Goods | -0.5 | 0.7 | 0.7 | 1.1 | 9.1 | 6.4 | -8.4 |
| Less Food & Energy | 0.2 | 0.6 | 1.0 | 1.4 | 6.2 | 4.3 | -4.2 |
| Crude Materials | -4.4 | -2.5 | 0.4 | -7.3 | 17.4 | 21.4 | -30.3 |
| Less Food & Energy | -1.8 | 1.1 | -0.3 | -4.0 | 18.5 | 32.5 | -23.3 |
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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