Wholesale prices rose 0.5% in April, more than expected

[BumRushDaShow]

Source: CNBC

Published Tue, May 14 2024 8:30 AM EDT Updated 21 Min Ago


Wholesale prices jumped more than expected in April, putting up another potential roadblock to interest rate cuts anytime soon.

The producer price index, a gauge of prices received at the wholesale level, increased 0.5% for the month, higher than the 0.3% Dow Jones estimate, the Labor Department’s Bureau of Labor Statistics reported Tuesday. However, the March reading was revised from an initially reported 0.2% gain to a decline of 0.1%.

Stripping out volatile food and energy prices, the core PPI also rose 0.5% compared with the 0.2% Dow Jones estimate. Excluding trade services from that core group showed a 0.4% increase on the month and 3.1% on a 12-month basis, the highest level since April 2023.

On a year-over-year basis, wholesale inflation rose 2.2%, also the highest in a year. The core PPI inflation was at 2.4%, the biggest annual move since August 2023. Both numbers were in line with estimates from Reuters.

Read more: https://www.cnbc.com/2024/05/14/ppi-report-wholesale-prices-rose-0point5percent-in-april-more-than-expected.html

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From the source -

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BLS-Labor Statistics
@BLS_gov
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PPI for final demand rises 0.5% in April; services increase 0.6%, goods advance 0.4% https://bls.gov/news.release/ppi.nr0.htm
#PPI #BLSdata
8:31 AM · May 14, 2024

[LonePirate]

1. With each passing day, it sure seems like big businesses are keep prices high to influence the election.

I welcome anyone to help talk me down from this conspiracy tree I have climbed because it certainly portends very dire times ahead if true.

[Marthe48]

2. Happened in the 1980 election

Underhanded ploys that enrich the rich and stick it to the rest of us are one of the basic dirty tricks brought to you by criminal rwnj.

[progree]

3. Graphs

ETA: All my numbers and graphs are seasonally adjusted numbers. As are the numbers prominently reported in the BLS news release and in the media (except the year-over-year numbers, i.e. the 12-month numbers, where non-seasonal numbers are used, presumably because the seasonal adjustment factor is the same in say April 2024 as in April 2023, so it wouldn't matter) https://www.bls.gov/news.release/ppi.nr0.htm

For example, the very first paragraph of the BLS news release (link just above) is:

The Producer Price Index for final demand rose 0.5 percent in April, seasonally adjusted, the
U.S. Bureau of Labor Statistics reported today. Final demand prices declined 0.1 percent in
March and advanced 0.6 percent in February. (See table A.) On an unadjusted basis, the index for
final demand moved up 2.2 percent for the 12 months ended in April, the largest increase since
rising 2.3 percent for the 12 months ended April 2023.

CORE PPI (without food, energy, & trade services):
. . . April: +0.4% (ughh)
. . . Last 12 months: +3.1% (biggest gain in the 12 month number since April 2023);

Regular PPI:
. . . April: +0.5% (uggh)
. . . Last 12 months: +2.2% (biggest gain in the 12 month number since April 2023);

This is disappointing in that the PPI is generally the lowest of the 3 inflation measures that I follow (CPI, PCE, PPI).

The 12 month numbers are nice (core +3.1%) and excellent (regular PPI +2.2%). Unfortunately the more recent month-over-month numbers are generally quite a bit higher than the earlier numbers. So the trend isn't good.

As for the graphs: Since the core measures are what the Fed focuses mainly on as a base for projecting FUTURE inflation, I'll present it first, followed by the regular "headline" PPI.

As for which core PPI measure (there are two core measures), since the BLS highlights the one below (without food, energy, and trade services) in its reporting (as opposed to the one without food and energy), then I guess I should do likewise.

https://www.bls.gov/news.release/ppi.nr0.htm

BLS Data Series CORE PPI (excluding food, energy, trade services): http://data.bls.gov/timeseries/WPSFD49116


On the 3 month: A nice little downturn for 2 months as big increases in Dec'23 and Jan'24 drop out of the 3-month window.
Unfortunately the new April'24 number is over 5% annualized - the worst of the 13 months shown with the exception of January.
===========================================================

BLS Data Series Regular PPI ( includes "everything" ): http://data.bls.gov/timeseries/WPSFD4



It's not a pretty picture.

The other inflation graphs are at: https://www.democraticunderground.com/10143231474#post1

(It also has the PPI graphs that were made BEFORE today's update. I think I'll wait until the CPI report comes out tomorrow before producing the latest all-three inflation measures graphs somewhere -- 6 sets of graphs since I produce the "regular" and "core" versions of each).

Edit: Sorry LonePirate, I meant this as a reply to the OP. But in reply to your post -- I've noticed that past small increases or even declines in the producer price index don't seem to carry over into the retail price indexes (CPI, PCE)

[LonePirate]

4. Thanks for the additional info and analysis.

[Bengus81]

8. With all the help Powell can give them.........

That inflation jump means the bread I buy at Walmart Market place went up by 0.0071 cents. But hell Powell,by all means let your buds over at US Bank,BOA,Chase and the rest keep GOUGING the hell out of credit card holders.

[Escurumbele]

9. You are correct, but we also need to admit that the Biden administration has not done much to prevent it from happening.

They need to do something fast because people do not see the evil that a trump presidency will do to this country, they don't see past their noses and don't understand that if they are complaining now about the cost of living, that it will get worst under trump with more tax cuts for the very rich, the cancellation of social benefits, etc. People only judge the work of the administration when they go shopping for food and other needs.

Biden needs to take aggressive actions to stop industry from raising prices just because they can.

[kimbutgar]

5. These big business don't seem to realize that if they put TFA back in office the economy will crash

In the next few years. As he purges our government agencies and installs his toadies things will go to hell real fast and they will all lose money! Layoffs will occur as demand goes down and more people will suffer financially. I hate greedflation!

[appleannie1]

7. They are doing it on purpose to blame Biden for inflation.

They want the orange faker in there so they don't have to pay taxes. Starve the people and make them pay more to run the country so they can buy a couple more mansions and another plane or two.

[ScratchCat]

10. Just like magic!!

Damn prices, acting all in and of themselves. Who knew they could rise? Maybe one day, like cancer and climate, mankind can figure out what causes prices to rise.

[Backseat Driver]

11. LOL, I skipped OUR weekend (Mon/Tues) Starbucks coffee to try out a $4 French Toast custom cookie this morning

for breakfast along with a double Mr. Bones coffee made at home! Think I actually saved a bit of coin for the piggy bank. Gotta go and plan paying the bills tomorrow when the check comes in - will these numbers maybe raise the future COLA computation...nah!

Dang, those fudgey fingered spelling errors!

[BumRushDaShow]

12. "will these numbers maybe raise the future COLA computation...nah! "

It might although this is just one month's number. There are a bunch of "calculator" sites out there that estimate what the COLA might be each quarter.

https://www.usatoday.com/story/money/2024/04/26/worried-about-the-2025-cola-see-the-smallest-cost-of-living-adjustment-social-security/73409194007/

https://www.fool.com/retirement/2024/04/28/social-security-2025-cola-is-unpleasant-surprise/

Will have to wait until the 3rd quarter (October) to get closest to what it might be before it's made official that month. My check was deposited last week so am obviously monitoring.