Global| Nov 06 2007EMU PPI on an Accelerating Trend…
Summary
The ex-energy PPI is not showing the same acceleration as the headline and is in fact decelerating across the main countries except for the UK, an EU country. If we look at the sequential growth rates by product in the table we find [...]
The ex-energy PPI is not showing the same acceleration as the headline and is in fact decelerating across the main countries except for the UK, an EU country. If we look at the sequential growth rates by product in the table we find that most categories are showing price deceleration as well. Capital goods are a minor exception. Consumer goods show a more pronounced acceleration in inflation. Overall EMU inflation is decelerating excluding energy to 2.7% over three months from 3.1% over six months and 3% year-over-year. At a 2.7% pace it still is well over the 2% inflation ceiling for the HICP that has been set by the ECB. Among main PPI components only intermediate goods inflation is below 2% over three months. Germany posts 3-month PPI inflation that is below 2% for both overall and ex-energy measures in September.
| Euro area and UK PPI Trends | ||||||
|---|---|---|---|---|---|---|
| M/M | Saar | |||||
| Euro area 13 | Sep-07 | Aug-07 | 3-Mo | 6-MO | Yr/Yr | Y/Y Yr Ago |
| Total ex Construction | 0.4% | 0.1% | 2.9% | 3.3% | 2.7% | 4.6% |
| Excl Energy | 0.2% | 0.3% | 2.7% | 3.1% | 3.0% | 3.6% |
| Capital Goods | 0.1% | 0.0% | 1.0% | 0.9% | 1.6% | 1.7% |
| Consumer Goods | 0.5% | 0.5% | 5.8% | 4.2% | 2.9% | 1.7% |
| Intermediate & Capital Goods | 0.1% | 0.1% | 1.3% | 2.6% | 3.1% | 4.6% |
| Energy | 1.0% | -0.5% | 3.5% | 4.2% | 1.6% | 7.8% |
| MFG | 0.4% | 0.1% | 3.3% | 4.6% | 3.4% | 2.8% |
| Germany | 0.2% | 0.1% | 0.7% | 1.5% | 1.5% | 5.1% |
| Ex Energy | 0.0% | 0.3% | 1.5% | 2.4% | 2.5% | 2.8% |
| Itlay | 0.5% | 0.2% | 4.4% | 4.2% | 3.5% | 5.5% |
| Ex Energy | 0.1% | 0.3% | 2.1% | 2.8% | 3.1% | 4.1% |
| UK | 0.5% | 0.0% | 4.5% | -0.6% | 2.6% | 6.2% |
| Ex Energy | 0.2% | 0.2% | 2.9% | 2.1% | 2.9% | 3.1% |
| Euro area 13 Harmonized PPI excluding Construction | ||||||
| The EA 13 countries are Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Slovenia and Spain. | ||||||
Robert Brusca
AuthorMore in Author Profile »Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.
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