A late Easter positioned the demand for eggs and meat almost on top of the PPI monthly pricing date, hiking the index above expectations in April but otherwise producing typical numbers after the atypical price drops of 2008’s second half.
The Bureau of Labor Statistics yesterday reported that the producer price index moved up 0.3% in April while the core rate was just the 0.1% increase that was anticipated.
“Prices really haven’t done much since December,” Scott Sager, senior BLS analyst, told Market News International during the half-hour data “lockup” for reporters prior to public release of the numbers. “Since December there has been some volatility in the index, but overall there hasn’t been significant movement” — a “typical” PPI after last year’s atypical declines.
Although the 12-month decline in prices at the factory loading dock is 3.7% through April, with “most of the declines in finished goods,” the PPI’s broadest index has dropped only 0.2%.
April’s late Easter, on the 12th, nearly coincided with the BLS’ PPI monthly pricing date of the 14th, and so the price survey captured the holiday demand for eggs and meats. Egg prices were up 43.7% in the survey, with beef and pork prices elevated. Without food prices included, the April PPI would have been up just 0.1%, which had been the median expectation.
“Easter pretty much coincided with the price date,” Sager said. “Easter probably did have some impact on the prices.”
Raw materials prices rose 3.0%, influenced by the higher food and energy prices, he said. Core crude materials dropped 0.6%, and for 12 months overall crude prices are down 40%, matching the annual decline through January 2002.
Intermediate goods prices were down 0.5%, and without food and energy were down 0.9%, “a continuation of the trend in the last six months or so,” Sager said.
Without seasonal adjustment, April’s producer prices actually went up 0.6%. The seasonal effect on gasoline prices was particularly strong, taking the unadjusted increase of 12.4% and turning it into a 2.6% rise. The seasonal adjustment factor expected a large gasoline increase this month, a little less than a 10% increase.
Expectations in a Market News International survey of economists centered on a rise of 0.1% in both the overall finished goods index and the April PPI core rate.
— Market News International
