Updated: 10-Apr-18 10:01 ET
| March PPI |
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| Updated: 10-Apr-18 10:01 ET |
Highlights
- The Producer Price Index (PPI) final demand increased 0.3% in March (Briefing.com consensus +0.2%) while the index for final demand less food and energy also increased 0.3% (Briefing.com consensus +0.2%). A 0.3% increase in prices for final demand services accounted for 70% of the rise in the final demand index.
Key Factors
- The month-over-month gains left the final demand index up 3.0% for the 12 months ended in March, versus up 2.8% in February, and the index for final demand less food and energy up 2.7%, versus up 2.5% in February.
- The index for final demand less foods, energy, and trade services increased 0.4%. It is up 2.9% year-over-year, which is the largest advance since tracking started in August 2014.
- Prices for final demand goods jumped 0.3%, with over half that increase attributable to a 31.5% increase in prices for fresh and dry vegetables. Prices for final demand energy were down 2.1%.
- The index for processed goods for intermediate demand fell 0.3% in March, which was the largest decline since February 2016. Prices for processed energy goods fell 3.1%.
- The index for unprocessed goods for intermediate demand declined 4.8% in March, which is the largest decrease since November 2015. Prices for unprocessed energy materials declined 11.6%.
Big Picture
- The key takeaway from the report is that producer prices are trending higher, which will feed concerns about a pass through to consumers and keep the Federal Reserve wedded to its belief that inflation rates are poised to pick up, leaving it with a tightening bias.
| Category | MAR | FEB | JAN | DEC | NOV |
| Final Demand | 0.3% | 0.2% | 0.4% | 0.0% | 0.4% |
| Core (excluding ...) | |||||
| Food and Energy | 0.3% | 0.2% | 0.4% | -0.1% | 0.2% |
| Food, Energy, and Trade | 0.4% | 0.4% | 0.4% | 0.1% | 0.3% |
| Final Demand Goods | |||||
| Total | 0.3% | -0.1% | 0.7% | 0.1% | 0.9% |
| Energy | -2.1% | -0.5% | 3.4% | 0.5% | 3.6% |
| Finished Goods | 0.2% | -0.3% | 0.7% | 0.0% | 1.1% |
| Final Demand Services | |||||
| Total | 0.3% | 0.3% | 0.3% | -0.1% | 0.2% |
| Trade | 0.2% | -0.2% | 0.3% | -0.4% | -0.3% |
| Intermediate Demand | |||||
| Processed | -0.3% | 0.7% | 0.7% | 0.5% | 0.5% |
| Unprocessed | -4.8% | 2.8% | 0.9% | 1.9% | 3.0% |
| Services | 0.3% | 0.5% | 0.1% | 0.0% | 0.5% |