The BLS released the PPI report this morning and it’s not good.
PRODUCER PRICE INDEXES - JUNE 2024
The Producer Price Index for final demand advanced 0.2 percent in June, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices were unchanged in May and increased 0.5 percent in April. (See table A.) On an unadjusted basis, the index for final demand rose 2.6 percent for the 12 months ended in June, the largest advance since moving up 2.7 percent for the 12 months ended March 2023.
The June rise in the index for final demand can be traced to a 0.6-percent increase in prices for final demand services. In contrast, the index for final demand goods decreased 0.5 percent.
Prices for final demand less foods, energy, and trade services were unchanged in June following a 0.2-percent advance in May. For the 12 months ended in June, the index for final demand less foods, energy, and trade services moved up 3.1 percent.
Final Demand
Final demand services: Prices for final demand services rose 0.6 percent in June after moving up 0.3 percent in May. Nearly all the June increase is attributable to a 1.9-percent jump in margins for final demand trade services. (Trade indexes measure changes in margins received by wholesalers and retailers.) The index for final demand services less trade, transportation, and warehousing inched up 0.1 percent. Conversely, prices for final demand transportation and warehousing services fell 0.4 percent.
Final demand goods: Prices for final demand goods moved down 0.5 percent in June after falling 0.8 percent in May. Most of the June decrease is attributable to a 2.6-percent drop in the index for final demand energy. Prices for final demand foods declined 0.3 percent, while the index for final
demand goods less foods and energy was unchanged.
Here is the chart.
There is hope that the Fed will cut in September but we’re not sure how that will help with both CPI and PPI slowing but not meeting 2 percent goals.
Stay tuned, stay profitable and stay solvent…