April PPI Jumps 1.4%; Core Rate Rises 0.2%

WASHINGTON — The May producer price index printed up 1.4% overall, and core was 0.2% higher for a 7.2% overall increase and a 3.0% jump in the core over the year — not favorable numbers.

But PPI’s import should be diminished as the consumer price index is already in hand at plus-0.6%/plus-0.2% and the PPI numbers did not totally flow through.

PPI energy posted a 4.9% hike and food rose 0.8%.

Core was held down by a 0.9% drop in light trucks and a 1.0% decrease in cars; furniture, periodicals, and liquor also edged lower after gaining in April. Cigarettes, aircraft, plastics, and communications equipment turned higher.

Intermediate PPI was up 2.9% and crude rose 6.7%, showing that there is no relief in sight from higher prices. Both also reflect gains in the energy components and in foodstuffs.

It would be more upsetting about PPI trends if CPI was moving in tandem, but for now some analyts are taking this gain simply as another illustration that prices are generally moving higher.

Nonetheless, May marks the eighth consecutive month that overall PPI has risen at more than 6% over the year, and that is similar to 1977’s or 1982’s inflation trends.

— Market News International

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