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Producer Prices: Modest Gain, Core Ticks Slightly Higher

February 15, 2018
Bottom Line: Producer inflation jumped in January. Energy prices continue to drive the headline, rising 3.4% after climbing 0.5% in December. while final demand services rose slightly. Core prices rose moderately, more than expected, and climbed slightly on a year-over-year basis. Overall inflationary pressures at the producer level still remain modest.

The PPI ROSE by 0.4% in January, compared with market expectations for an increase of 0.4%. Overall producer prices are 2.6% ABOVE the year ago level.

The Goods PPI ROSE by 0.7% in January and is now 3.4% ABOVE its year ago level. Food prices fell by 0.2% but are now 1.7% ABOVE their year ago level. Meanwhile energy prices rose by 3.4%. and are now 9.6% ABOVE their year ago level. The Goods PPI less food and energy ROSE by 0.2%, and is now 2.1% ABOVE its year ago level.

The Services PPI ROSE by 0.3% in January and is now 2.2% ABOVE its year ago level.

The Core PPI ROSE by 0.4%, compared with market expectations for a increase of 0.2%. Core producer prices are now 2.3% ABOVE their year ago level.