Global| May 12 2011U.S. PPI Strength Driven By Energy
by:Tom Moeller
|in:Economy in Brief
Summary
The U.S. producer price index for finished goods increased 0.8% during April, similar to the 0.7% March gain. The rise was stronger than the 0.6% Consensus expectation and the y/y increase of 6.6% was its strongest since September [...]
The U.S. producer price index for finished goods increased 0.8%
during April, similar to the 0.7% March gain. The rise was stronger than
the 0.6% Consensus expectation and the y/y increase of 6.6% was its
strongest since September 2008. Less food & energy, pricing pressures
remained firm. The 0.3% gain in the PPI less food & energy equaled the
March increase. The latest also beat Consensus expectations for a 0.2%
rise and the 2.1% y/y gain was its strongest since August 2009.
Higher energy prices continued to drive the overall PPI with a 2.5% gain (20.6% y/y) as gasoline prices increased a not seasonally adjusted 8.9% (38.7% y/y). Since the late-2008 low, gasoline prices have more-than-doubled. Home heating oil prices also were strong, posting a 6.1% increase (37.6% y/y). Natural gas prices rose a moderate 1.5% (0.6% y/y) while electricity prices gained 0.6% (3.1% y/y). Food prices posted a moderate 0.3% rise but the y/y increase remained strong at 5.1%. Meat prices (15.8% y/y) and dairy product prices (15.5% y/y) firmed further.
Finished consumer goods prices rose a stronger 0.9% (8.5% y/y) with the gain in food & energy costs. Core prices rose 0.3% (2.8% y/y). Furniture prices rose 2.1% y/y, the strongest gain since 2009 but appliance prices slipped 0.1% m/m (0.5% y/y). Men's apparel prices increased 2.3% y/y but women's clothing prices rose just 0.7%. Capital goods prices increased 0.3% last month and by an accelerated 1.3% y/y, the most since August 2009.
Intermediate goods prices jumped another 1.3% as energy prices increased 1.9% (20.4% y/y). Food prices also strengthened by 1.8% (14.3% y/y). Core-intermediate prices remained firm and rose another 1.1% (5.6% y/y). Crude materials prices jumped 4.0% (23.5% y/y). Strength in factory output lifted prices less food & energy prices by 2.6% (18.2% y/y. Metal prices remained strong. Crude energy prices rose 4.8% (20.6% y/y) while food prices rose 4.0% (29.7% y/y).
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 | 2010 | 2009 | 2008 |
|---|---|---|---|---|---|---|---|
| Finished Goods | 0.8 | 0.7 | 1.6 | 6.6 | 4.2 | -2.5 | 6.4 |
| Energy | 2.5 | 2.6 | 3.3 | 20.6 | 13.8 | -17.7 | 14.1 |
| Food | 0.3 | -0.2 | 3.9 | 5.1 | 3.9 | -1.4 | 6.8 |
| Less Food & Energy | 0.3 | 0.3 | 0.2 | 2.1 | 1.2 | 2.5 | 3.4 |
| Intermediate Goods | 1.3 | 1.5 | 2.0 | 9.4 | 6.4 | -8.4 | 10.3 |
| Less Food & Energy | 1.1 | 0.9 | 1.1 | 5.6 | 4.3 | -4.2 | 7.4 |
| Crude Materials | 4.0 | -0.5 | 3.4 | 23.5 | 21.4 | -30.3 | 21.5 |
| Less Food & Energy | 2.6 | -2.3 | 2.3 | 18.2 | 32.6 | -23.4 | 14.7 |
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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