U.S. wholesale prices surge again and show inflation still rampant, PPI finds

[mahatmakanejeeves]

Last edited Thu Aug 12, 2021, 11:47 AM - Edit history (3)

Source: MarketWatch

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U.S. wholesale prices surge again and show inflation still rampant, PPI finds

Last Updated: Aug. 12, 2021 at 9:44 a.m. ET
First Published: Aug. 12, 2021 at 8:47 a.m. ET
By Jeffry Bartash

The numbers: U.S. wholesale prices rose sharply in July for the sixth month in a row and offered little evidence that a big wave of inflation is on the verge of cresting.

The producer price index jumped 1% last month, the government said Thursday. Economists polled by The Wall Street Journal had forecast a 0.6% advance.

Most of the increase was concentrated in services such as passenger fares and hotel rooms amid a surge in travel this summer. Wholesale auto prices have also risen sharply due to strong demand and carmakers not being able to produce enough vehicles.

The pace of wholesale inflation over the past 12 months moved up to 7.8% from 7.3%. That's the highest level since the index was reconfigured in 2010, and likely one of the highest readings since the early 1980s.

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Big picture: Inflation has surged along with a nearly full reopening of the U.S. economy. Consumers have a huge appetite for all sorts of goods and services, but businesses can't keep up with the demand because of widespread shortages of labor and materials.

The wave of inflation is expected to recede once the economy returns to normal, but it's far from clear how long it will take. Some economists also wonder if the rate of inflation will end up significantly higher than the Federal Reserve's 2% target.

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About the Author
Jeffry Bartash [e-mail] https://twitter.com/jbartash
Jeffry Bartash is a reporter for MarketWatch in Washington.

Read more: https://www.marketwatch.com/story/u-s-wholesale-prices-surge-again-and-show-inflation-still-rampant-ppi-finds-11628772476

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Hat tip, Calista241, for coming up with the link to MarketWatch

Here's the original material:

-- -- -- -- -- --

PPI for final demand advances 1.0% in July; services rise 1.1%, goods increase 0.6%

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

Economic News Release USDL 21-1469

Producer Price Index News Release summary
Transmission of material in this release is embargoed until 8:30 a.m. (ET), Thursday, August 12, 2021

Technical information: [phone] * [e-mail] * www.bls.gov/ppi
Media contact: [phone] * [e-mail]


PRODUCER PRICE INDEXES - JULY 2021


The Producer Price Index for final demand increased 1.0 percent in July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices rose 1.0 percent in June and 0.8 percent in May. (See table A.) On an unadjusted basis, the final demand index moved up 7.8 percent for the 12 months ended in July, the largest advance since 12-month data were first calculated in November 2010.

Nearly three-fourths of the July increase in the final demand index can be traced to a 1.1-percent advance in prices for final demand services. The index for final demand goods rose 0.6 percent.

Prices for final demand less foods, energy, and trade services moved up 0.9 percent in July, the largest advance since climbing 1.0 percent in January. For the 12 months ended in July, the index for final demand less foods, energy, and trade services rose 6.1 percent, the largest increase since 12-month data were first calculated in August 2014.

{snip}

________________
The Producer Price Index for August 2021 is scheduled to be released on Friday, September 10, 2021 at 8:30 a.m. (ET).

[LymphocyteLover]

1. I'm not familiar with this index-- are these numbers good or bad?

[mahatmakanejeeves]

2. Note: the 7.8 percent figure is on an annual basis, not in one month.

INFLATION Published 31 mins ago

Producer prices soar 7.8% annually in July, most on record

Prices rose 1% month over month

Producer prices accelerated at the fastest annual pace on record in July as supply chain disruptions and materials shortages continued to put upward pressure on costs.

The producer price index for final demand increased at a 7.8% pace for the 12 months ended July, according to the Labor Department. The July print was faster than the 7.3% pace recorded in June and ahead of the 7.3% rate that analysts surveyed by Refinitiv were expecting. The reading was the strongest since recordkeeping began in November 2010.

Producer prices rose 1% in July, matching the increase from June. Analysts were anticipating prices would grow at a 0.6% pace.

This story is developing. Check back for updates.

[Calista241]

3. Bad. Very Bad.

https://www.marketwatch.com/story/u-s-wholesale-prices-surge-again-and-show-inflation-still-rampant-ppi-finds-11628772476

"The pace of wholesale inflation over the past 12 months moved up to 7.8% from 7.3% in June. That’s the highest level since the index was reconfigured in 2010, and likely one of the highest readings since the early 1980s."

[mahatmakanejeeves]

4. Thanks. I still haven't seen anything at Yahoo! Finance. I looked at The Wall Street Journal. too.

Nothing there either.

I'll look again at lunch.

When things cost more for producers, the increases will eventually make their way to consumers.

Best wishes.

[mahatmakanejeeves]

5. Stock market news live updates: Stocks dip after jobless claims meet estimates, producer prices rise

Yahoo Finance

Stock market news live updates: Stocks dip after jobless claims meet estimates, producer prices rise

Emily McCormick · Reporter
Thu, August 12, 2021, 9:33 AM

Stocks traded slightly lower Thursday to hover just below record highs, as investors took into account more mixed economic data and considered the likelihood of more government spending on infrastructure.

The S&P 500 and Dow each fell to pull back from Wednesday's all-time highs. The moves came after a new report on weekly jobless claims met estimates, while a separate print on producer price increases came in hotter than expected.

Heading into the session, one of the latest sources of fuel for equities came after the Labor Department's monthly consumer price index showed that prices rose in-line with expectations in July, gaining 0.5% month-on-month to decelerate from June's gain. Prices for used cars and trucks and airline tickets slowed markedly, underscoring the moderation in inflationary pressures as the economic recovery matured and an initial wave of pent-up consumer demand was released.

"We're still at very high levels of inflation in this country and the debate still rages as to whether we're going to see a glide path towards substantially lower levels of inflation, or will it remain at sticky levels much higher than what was anticipated by the Fed and market participants," Mark Luschini, chief investment strategist at Janney Montgomery Scott, told Yahoo Finance. "However in the meantime, it also does suggest that perhaps we have seen the peak in this inflation cycle ... perhaps it's indicative that what the Fed has suggested to investors, that this inflationary spike will be transitory, will turn out to come to fruition."

{snip}

[NoMoreRepugs]

6. Is it possible to break down the numbers and account for the tremendous increase

in shipping cost for overseas materials???

[mahatmakanejeeves]

7. I don't know. The BLS reports are loaded with charts. The data might be in there.

Thanks for writing.

[NoMoreRepugs]

9. TY for all the incredible work u do with all the available statistics of note.

[mahatmakanejeeves]

12. You're welcome. It's all cut and paste, cut and paste.

I post the reports whether they're good or bad. Not everyone likes that, when the person in office has a (D) after his name, and it's bad news.

Thanks for writing.

[cstanleytech]

8. And yet retailers like Walmart and Publix as well as the service industry like McDonalds continue to

treat their employees like shit on the bottom of their shoes with pay that is low and or hours that suck ass that does not amount to enough to not worry about how to pay their bills let alone save enough to actually retire on.

[MichMan]

10. We have been assured it is only transitory, so nothing to be concerned about

When is the transitory period expected to end?

[Johnny2X2X]

11. Global Supply chains breaking down because of Covid causes some temporary elevated Inflation

The experts claim this won't be a story later this Fall.