Wholesale Prices Little Changed in May
Wholesale prices were little changed in May from the prior month, reflecting declines in the costs of fuel and food, Labor Department data showed June 13.
Highlights of PPI
• Producer-price index was unchanged (matching forecasts) following a 0.5% gain the prior month.
• Wholesale prices advanced 2.4% from a year earlier (forecast was 2.3%), after rising 2.5%.
• PPI excluding food and energy rose 0.3% from prior month and was up 2.1% from May 2016.
Key Takeaways
The figures indicate a pause in inflationary pressures in the production pipeline after climbing in the year ended in April at a rate that matched the fastest since September 2012.
Prices excluding food, fuel and trade services, a figure some economists prefer because it’s less volatile, were up 2.1% on a year-over-year basis for a second month.
Federal Reserve officials are widely expected to raise the benchmark interest rate at the conclusion of their two-day meeting June 14, with slow but fairly steady gains in inflation permitting them to be patient about the pace of those rate increases.
Other Details
• Excluding volatile categories of food, energy, and trade services, producer costs fell 0.1% after jumping 0.7% the prior month.
• Goods prices fell 0.5% after a 0.5% April increase; services climbed 0.3% after a 0.4% advance.
• Cost of energy dropped 3% from prior month, the most in more than a year; food costs fell 0.2%.
• Prices for final demand services increased 0.3%, with half the increase attributed to margins at fuel retailers.
• Services for final demand rose 2.1% from a year earlier, the biggest gain since December 2014.
