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Producer Price Index declined 1.3% in April, ex Fd & Engy down 0.9%
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The Producer Price Index for final demand declined 1.3 percent in April, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This decrease is the largest since the index began in December 2009. Final demand prices fell 0.2 percent in March and 0.6 percent in February. On an unadjusted basis, the final demand index moved down 1.2 percent for the 12 months ended in April, the largest decline since falling 1.3 percent for the 12 months ended November 2015.
In April, over 80 percent of the decrease in the final demand index can be traced to a 3.3-percent drop in prices for final demand goods. The index for final demand services moved down 0.2 percent.
Prices for final demand less foods, energy, and trade services fell 0.9 percent in April, the largest decline since the index was introduced in September 2013. For the 12 months ended in April, the index for final demand less foods, energy, and trade services moved down 0.3 percent, the first 12-month decrease.
Final Demand
Final demand goods: The index for final demand goods fell 3.3 percent in April, the largest decline since the series began in December 2009. Most of the broad-based decrease is attributable to prices for final demand energy, which fell 19.0 percent. The indexes for final demand goods less foods and energy and for final demand foods moved down 0.4 percent and 0.5 percent, respectively.
Product detail: Two-thirds of the April decrease in the index for final demand goods can be traced to prices for gasoline, which dropped 56.6 percent. This is the largest decrease since the series began in February 1947. The indexes for jet fuel, diesel fuel, basic organic chemicals, home heating oil, and corn also moved lower. In contrast, prices for beef and veal rose 12.6 percent. The indexes for distilled and bottled liquor (excluding brandy) and for electric power also increased.
Final demand services: The index for final demand services fell 0.2 percent in April following a 0.2-percent advance in March. Leading the decrease, prices for final demand services less trade, transportation, and warehousing moved down 0.9 percent. The index for final demand transportation and warehousing services declined 3.5 percent. Conversely, margins for final demand trade services increased 1.6 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.)
Product detail: Leading the April decline in the index for final demand services, prices for portfolio management fell 12.0 percent. The indexes for airline passenger services; traveler accommodation services; services related to securities brokerage and dealing (partial); hospital outpatient care; and apparel, footwear, and accessories retailing also moved lower. In contrast, margins for automotive fuels and lubricants retailing rose 41.6 percent. The indexes for inpatient care and for chemicals and allied products wholesaling also advanced.
Posted: May 13, 2020 Wednesday 08:30 AM