August 14, 2023 (MLN): The U.S. Producer Price Index (PPI) for final demand experienced a 0.3% increase in July, U.S. Bureau of Labor Statistics revealed on Friday.
This follows unchanged prices in June and a 0.3% decline in May. Unadjusted data shows a 0.8% advancement in the index for the 12 months ending in July.
The rise in July's final demand prices was primarily driven by a 0.5% increase in the index for final demand services, with final demand goods experiencing a more modest 0.1% uptick.
Of note, the index for final demand excluding foods, energy, and trade services saw a 0.2% rise in July, marking the most significant increase since February. Over the 12 months ending in July, prices for final demand excluding foods, energy, and trade services surged by 2.7%.
Final demand services, in July, the index for final demand services rose by 0.5%, the most substantial rise since August 2022.
Notably, prices for final demand services excluding trade, transportation, and warehousing increased by 0.3%.
Margins for final demand trade services saw a 0.7% increase, while the index for final demand transportation and warehousing services advanced by 0.5%. (Trade indexes monitor changes in margins for wholesalers and retailers.)
A notable 40% of the July increase in the index for final demand services can be attributed to a 7.6% surge in portfolio management prices.
Additional contributors to the rise included machinery and vehicle wholesaling, outpatient care (partial), chemicals and allied products wholesaling, securities brokerage, dealing, investment advice, and related services, and transportation of passengers (partial).
However, margins for food and alcohol retailing declined by 2.5%, and the indexes for application software publishing and long-distance motor carrying also fell.
Prices for final demand goods inched up by 0.1% in July, following no change in June. The uptick was primarily driven by a 0.5% increase in the index for final demand foods.
Prices for final demand goods excluding foods and energy, as well as for final demand energy, remained unchanged.
Within the index for final demand goods, meats experienced a substantial 5.0% price increase in July. Conversely, prices for diesel fuel dropped by 7.1%. Additionally, the indexes for gasoline, fresh fruits and melons, and plastic resins and materials also experienced decreases.
The Producer Price Index (PPI) measures the average change over time in the selling prices received by domestic producers for their output. The prices included in the PPI are from the first commercial transaction for many products and some services.
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Posted on: 2023-08-14T13:05:23+05:00
