The Producer Price Index for final demand advanced 0.1 percent in June, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. In June, the rise in final demand prices is attributable to a 0.4-percent increase in the index for final demand services. Conversely, prices for final demand goods fell 0.4 percent.

Final Demand Goods

  • Prices for final demand goods moved down 0.4 percent in June, the largest decrease since falling 0.6 percent in January. The June decline is attributable to a 3.1-percent drop in the index for final demand energy. Conversely, prices for final demand foods climbed 0.6 percent.
  • The index for final demand goods less foods and energy was unchanged.
  • Product detail: Nearly 60 percent of the June decrease in the index for final demand goods can be traced to a 5.0-percent decline in prices for gasoline. The indexes for diesel fuel, meats, liquefied petroleum gas, iron and steel scrap, and residual fuels also moved lower. In contrast, corn prices rose 19.9 percent. The indexes for ethanol and residential electric power also increased.

Final Demand Services

RECOMMENDED ARTICLES

  • The index for final demand services rose 0.4 percent in June, the largest increase since climbing 0.8 percent in October 2018. Most of the June advance is attributable to margins for final demand trade services, which moved up 1.3 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.)
  • Prices for final demand transportation and warehousing services rose 0.3 percent, while the index for final demand services less trade, transportation, and warehousing was unchanged.
  • Product detail: Over a quarter of the June increase in prices for final demand services can be traced to margins for fuels and lubricants retailing, which jumped 12.2 percent. The indexes for health, beauty, and optical goods retailing; apparel, footwear, and accessories retailing; machinery, equipment, parts, and supplies wholesaling; loan services (partial); and truck transportation of freight also moved higher. In contrast, prices for traveler accommodation services fell 4.0 percent. The indexes for jewelry retailing and airline passenger services also declined.

Mike "Mish" Shedlock

PPI Jumps 0.6% in March: Goods Up 1.0%, Services Up 0.3%

The PPI rose 0.6% with 60% of the rise due to a 1.% rise in goods, and most of that energy related.

PPI Services Shows No Price Pressures

Wholesale prices show continued weakness, especially services. The BLS reports PPI for Final Demand Declines 0.1% in March. Services and goods both decreased by 0.1%. Y

PPI Declines First Time Since August 2016

Producer prices unexpectedly declined in December. Trade services fell a steep 0.6 percent.

Services PMI and Non-Manufacturing ISM Diverge Strongly Again

The soft data divergence between the ISM Non-Manufacturing Report on Business and the Markit Services PMI widened again today. Let’s take a look at each report.

ISM-Markit Manufacturing Divergence Widens Again

The divergence between the ISM Report on Business and the Markit PMI manufacturing index widened this month. ISM increased slightly from 54.8 to 54.9 while the Markit reading declined slightly to an 8-month low of 52.7 from 52.8

Inflationistas Disappointed: Producer Price Index Flat, Services +0.3%, goods -0.5%

Those rooting for higher inflation were not happy with today’s PPI report that shows producer prices flat for the month vs an Econoday consensus of a 0.1 percent rise.

Jobs +201,000 vs Employment -423,000: Another BLS Divergence

Nonfarm jobs rose but actual employment fell in two different measures of the BLS July jobs report.

PPI Uneven Jump Hints at More Consumer Weakness, Trouble at Retailers

The BLS reported the Producer Price Index (PPI) for final demand rose 0.5%. This exceeded the Econoday consensus of 0.2% in a range of -0.2% to +0.3%. Details are interesting.

PPI Much Hotter Than Expected But Bond Yields Flat

The Producer Price Index jumped to 0.5% vs expectations of 0.1%. The bond market did not react one bit.