US Producer Prices Slip in September

In September, producer prices for goods were down 1.2%, the sharpest fall since January.

Producer prices in the United States fell by more than anticipated in the month of September, according to a report released by the Labor Department on Wednesday, with the decrease largely reflecting a steep drop in energy prices.

On a year-on-year basis, PPI excluding food, energy and trade grew 0.5%, down from the 0.7% gain in August and short of analysts’ expectations for a 0.8% increase.

The bigger than expected drop in producer prices was primarily due to the 5.9% decrease in energy prices, which came on the heels of a 3.3% decline in the previous month. Energy prices fell 5.9%, accounting for most of the decline, while food prices fell 0.8%. In the 12 months through September, the PPI fell 1.1 percent after declining 0.8 percent in August. The majority of the downward trend can be credited to a decline in prices for final demand goods, products used by the final user which do not need any more processing, which fell 1.2 percent.

The index measures prices from the perspective of the seller but generally tracks closely with other measures of inflation for consumers. The September decrease was attributable to a decrease in prices for final demand goods and services.

The Labor Department said nearly half of the drop can be traced to prices for final demand services less trade, transportation, and warehousing, which fell by 0.3 percent. Neither EconoTimes nor its third party suppliers shall be liable for any errors, omissions or delays in content, or for any actions taken in reliance thereon.