Wholesale Prices Rose More Than Forecast in October
U.S. wholesale prices advanced more than forecast in October, boosted by higher margins at fuel retailers, a Labor Department report showed Nov. 13 in Washington. Compared with a year earlier, producer prices rose the most in more than five years.
Highlights of Producer Prices for October
• Producer-price index rose 0.4% (estimated 0.1% gain) for a second month.
• PPI climbed 2.8% from a year earlier, the most since February 2012, after 2.6% gain in prior 12-month period.
• Excluding food and energy, core gauge rose 0.4% from prior month and was up 2.4% from October 2016.
Key Takeaways
The report indicates price pressures in the production pipeline may be starting to build even as broader inflation remains below the Federal Reserve’s goal.
The PPI reflected a 0.5% increase in services costs, the most since April, and a 0.3% gain in the cost of goods, the report showed.
Nearly half of the gain in services costs reflected higher margins for fuel retailers, which surged almost 25%. Almost half of the advance in goods prices was attributable to pharmaceuticals, which climbed 2.1%.
The PPI excluding food, energy, and trade services, a measure some economists prefer because it strips out the most volatile components, rose 2.3% from October 2016, the most in records to mid-2014, following a 2.1% gain.
Other Details
• Excluding the volatile categories of food, energy, and trade services, producer costs climbed 0.2% for a third month.
• Energy-related goods prices were unchanged in October, while food costs climbed 0.5%, the most in four months.
With assistance by Jordan Yadoo
