Wholesale Prices Little Changed in May
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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.