Economy

PPI: Producer Price Index Falls Modestly in March, Missing Views

The Producer Price Index (PPI) reported by the Labor Department Bureau of Labor Statistics.

The Labor Department’s Producer Price Index (PPI) unexpectedly fell in March by 0.1% after slipping 0.2% in February, missing economists’ expectations. In the 12 months through March, the PPI fell 0.1% after remaining flat in the prior 12 months leading up to February.

Economists polled by Reuters had forecast the PPI increasing 0.2% last month and 0.3% on a year-over-year basis. The slip was fueled by rising energy prices being offset by a decreasing cost of services, which supports the Federal Reserve’s cautious plan to increasing interest rates.

The so-called core PPI–excluding food, energy and trade services–was up 0.9% in the 12 months through March after rising by the same percentage in February year-over-year. On a monthly basis, the core PPI increased by just 0.1% in February.

Table A. Monthly and 12-month percent changes in selected final demand price indexes, seasonally adjusted
Month	Total final demand	Final demand less foods, energy, and trade	Final demand goods				Final demand services				Change in final demand from 12 months ago (unadj.)	Change in final demand less foods, energy, and trade from 12 mo. ago (unadj.)
Month	Total final demand	Final demand less foods, energy, and trade	Total	Foods	Energy	Less foods and energy	Total	Trade	Transportation and warehousing	Other	Change in final demand from 12 months ago (unadj.)
2015
Mar.	0.0	0.0	-0.1	-0.9	0.6	-0.1	0.1	0.2	-0.3	0.1	-0.9	0.7
Apr.	0.0	0.2	-0.5	-0.9	-2.1	0.1	0.2	0.0	-0.3	0.4	-1.1	0.8
May	0.5	0.0	1.2	1.1	5.7	0.1	0.0	0.2	-0.1	-0.1	-0.8	0.7
June	0.3	0.3	0.5	0.4	0.7	0.4	0.3	0.3	0.2	0.3	-0.5	0.8
July	0.1	0.1	-0.3	-0.8	-0.7	0.0	0.3	0.6	-0.1	0.1	-0.7	0.9
Aug.	-0.2	0.0	-0.5	0.2	-2.6	-0.2	-0.1	-0.4	-0.9	0.2	-1.0	0.6
Sept.	-0.5	-0.1	-1.0	-0.3	-5.3	0.0	-0.1	0.2	0.0	-0.2	-1.1	0.5
Oct.	-0.2	-0.2	-0.3	-0.7	-0.2	-0.3	-0.2	-0.2	-0.1	-0.1	-1.4	0.4
Nov.(1)	0.1	0.1	-0.1	-0.3	0.1	-0.1	0.1	0.1	0.1	0.1	-1.3	0.2
Dec.(1)	0.0	0.2	-0.6	-0.9	-3.2	0.2	0.4	0.5	-0.6	0.4	-1.0	0.3
2016
Jan.	0.1	0.2	-0.7	1.0	-5.0	0.0	0.5	0.9	0.4	0.4	-0.2	0.8
Feb.	-0.2	0.1	-0.6	-0.3	-3.4	0.1	0.0	-0.4	-0.7	0.3	0.0	0.9
Mar.	-0.1	0.0	0.2	-0.9	1.8	0.1	-0.2	-0.5	-0.3	-0.1	-0.1	0.9
Footnotes (1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for November 2015 have been revised to reflect the availability of late reports and corrections by respondents.

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PPD Business Staff

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