U.S. PPI Edges Higher in June; Core Prices Also Rise Minimally
by:Tom Moeller
|in:Economy in Brief
Summary
- Annual gain is weakest since late-2020.
- Core goods & services prices both post lessened y/y increases.
- Food prices ease but energy prices rise m/m.
The Producer Price Index for final demand rose 0.1% during June (also 0.1% y/y), following a 0.4% May decline, revised from -0.3%. A 0.2% increase had been expected in the Action Economics Forecast Survey. The yearly increase was down from the 11.7% high in March of 2022. The PPI excluding food & energy increased 0.1% (2.4% y/y) after rising 0.1%. A 0.2% increase had been expected. The PPI excluding food, energy & trade services increased 0.1% (2.6% y/y) following no change in May. Prices edged 0.1% higher in each of the prior two months.
Energy prices rose 0.7% (-23.9% y/y) after falling 6.8% in May. Gasoline prices rose 3.4% (-36.4% y/y) after falling 13.6% in May and the cost of home heating oil rose 1.3% (-46.5% y/y) after a 12.3% decline. Natural gas prices fell 0.9% (-13.1% y/y), off for the fifth straight month, and electric power prices rose 0.9% (+7.7% y/y) after rising 0.5% in May.
Food prices slipped 0.1% last month (+0.2% y/y), off for the sixth month in the last seven. Beef & veal prices jumped 4.0% (14.8% y/y) following a 0.7% gain while egg prices rose 33.8% (-37.8% y/y) after falling 53.4%. Dairy product prices weakened 2.0% (-11.3% y/y) after a 1.3% decline but processed fruit & vegetable prices rose 0.1% (14.1% y/y) after rising 1.4%.
Goods prices less food & energy fell 0.2% in June (+2.0% y/y) following a 0.1% uptick in May. Core consumer goods prices held steady (+4.1% y/y) following a 0.3% rise. The cost of core nondurable consumer goods edged 0.1% higher (5.0% y/y) after a 0.3% gain while durable consumer goods prices held steady (+2.7% y/y) following a 0.2% increase. Private capital equipment prices rose 0.1% (4.5% y/y) following a 0.3% gain. The cost of government-purchased goods less food & energy weakened 0.2% (+0.9% y/y) following a 0.1% May slip.
Services prices rose 0.2% (2.3%) in June, the same as in May. Trade services prices improved 0.2% (1.5% y/y) following a 0.7% gain. The final demand price of transportation & warehousing of finished services declined 0.9% (-7.7% y/y), off for the sixth consecutive month. Services prices less these costs improved 0.3% (3.9% y/y) after holding steady in May.
Construction costs were unchanged (+10.3% y/y) last month after edging 0.1% higher in May. Intermediate goods prices fell 0.6% in June (-9.4% y/y), off for the fifth month this year.
The PPI data are published by the Bureau of Labor Statistics and can be found in Haver's USECON database. Further detail is contained in PPI and PPIR. The expectations figures are available in the AS1REPNA database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
