U.S. Producer Price Inflation Moderates in April
by:Tom Moeller
|in:Economy in Brief
Summary
- Services prices hold steady.
- Core goods prices remain strong.
- Energy & food prices soar again.
The Producer Price Index for Final Demand increased 0.5% during April following a record 1.6% increase during March. The y/y increase in the PPI overall moderated slightly to 11.0%. A 0.6% increase had been expected in the Action Economics Forecast Survey. The series dates back to November 2009.
Prices less food & energy increased 0.4% (8.8% y/y) after increasing 1.2% in March. A 0.7% rise had been expected. The PPI excluding food, energy & trade services rose 0.6% following a near-record 0.9% (6.9% y/y) increase in March.
The gain in the PPI overall was held back by an unchanged level of services prices, following a 1.2% March increase. They rose 8.1% y/y. A 0.5% decline in trade services prices held back the overall change, off from a 1.9% March increase. Services prices less trade, transportation & warehousing eased 0.1% in April (+3.2% y/y) after rising 0.3% in March.
Energy prices ratcheted up yet again, rising 1.7% (40.0% y/y) following a 6.4% March rise. Food prices soared 1.5% in April (16.3% y/y) after significant gains in the prior three months.
Prices for final demand finished goods less food & energy increased 1.0% (10.1% y/y). Finished consumer goods prices less food & energy rose 0.8% in April (8.0% y/y) following a 0.7% increase. Durable consumer goods prices rose 0.9% last month (8.9% y/y) after three months of similar increase. Core nondurable consumer goods prices rose 0.7% (7.5% y/y) following a 0.5% March increase. Prices for private capital equipment jumped 1.2% (9.3% y/y) after rising 0.8% in March.
Construction product prices strengthened 4.0% (19.6% y/y) after rising 0.6% in March.
Intermediate goods prices jumped 2.2% (21.9% y/y) due to a 4.5% gain (44.9% y/y) in processed fuel costs.
The PPI data are published by the Bureau of Labor Statistics and can be found in Haver's USECON database. Further detail is contained in PPI and PPIR. The expectations figures are available in the AS1REPNA database.
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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