In the United States, the rise in the producer price index (PPI) accelerated in July. The strength of certain service categories was the main driver. Last month’s figures were revised downwards.
Key point July PPI up 0.3% month-on-month Economists forecast up 0.2% Market forecast up 0.7% YoY, up 0.8% YoY Excluding food and energy Core PPI up 0.3% month-on-month vs. forecast up 0.2% YoY up 2.4% vs. forecast up 2.3%
The normalization of global supply chains, weak external demand, and a broad shift in consumer demand from goods to services have all contributed to easing inflationary pressures at the producer level over the past year. But oil prices are rising and the headwinds are starting to blow again.
Upper row: Producer Price Index (PPI) month-on-month change, Lower row: PPI year-on-year change
Source: U.S. Bureau of Labor Statistics
Service costs rose sharply for the first time in almost a year. This reflected higher prices for portfolio management, ambulatory care and passenger transportation.
Some categories of PPI statistics, such as health care, will be used to calculate the Personal Consumption Expenditure (PCE) price index, which will be released this month. The Federal Reserve Board (FRB) regards the PCE price index as an inflation indicator.
Matthew Martin and Oren Krachkin of Oxford Economics said: “Undercurrent trends suggest that PPI inflation is returning to its pre-coronavirus rise, but progress is likely to be slow. ” analyzed in the report.
“While these data are comforting to Federal Reserve officials, they will maintain their hawkish tone and watch to see if July’s surge in service prices continues in the months to come.” Ta.
Video: Bloomberg Television
Source: Bloomberg
Inflation accelerated in outpatient care and nursing homes within health care. Physician costs remained largely unchanged. Securities brokerage and investment advisory costs, which are also used to calculate the PCE price index, rose sharply in July.
Goods prices rose slightly. Food prices, which rose sharply since November last year, pushed up. The core price index for goods, excluding food and energy, was unchanged from the previous month. It was down in June. The decline in goods prices over the past few months has spread in the form of a fall in consumer prices, and if it progresses, it could lead to a state of deflation.
U.S. CPI core index slows for 2nd straight month, hopes for subduing inflation (3)
PPI, which excludes food, energy and trade services, rose 0.2% from the previous month. Compared to the same month of the previous year, it increased by 2.7%.
The cost of intermediate goods, which reflects prices at a relatively early stage in the production process, continues to fall. Intermediate goods costs, excluding food and energy, fell sharply for the first time since October last year.
See table for detailed statistics.
Original title: US July PPI Rose 0.3%, Above Estimate (excerpt)
US Producer-Price Inflation Picks Up on Boost From Services(excerpt)
(Adds economist comments and video)
2023-08-11 12:35:56
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