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Producer Prices rose 1.3% in January After Rising 0.8% over All of 2020

Summary:
Commenter and writer RJS describes himself as “unencumbered by education, affiliations, beliefs or agenda and im not advocating anything.” Market Watch 666 The seasonally adjusted Producer Price Index (PPI) for final demand rose 1.3% in January, as prices for finished wholesale goods were on average 1.4% higher, while margins of final services providers increased by 1.3%  .  .  .  that followed a revised December report that now shows the PPI was up 0.3%, with prices for finished wholesale goods up 1.0% while margins of final services providers were 0.1% lower, a revised November report that shows the PPI was 0.1% higher, with prices for finished wholesale goods rising 0.3% while margins of final services providers decreased 0.2%, a revised October

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Commenter and writer RJS describes himself as “unencumbered by education, affiliations, beliefs or agenda and im not advocating anything.” Market Watch 666


The seasonally adjusted Producer Price Index (PPI) for final demand rose 1.3% in January, as prices for finished wholesale goods were on average 1.4% higher, while margins of final services providers increased by 1.3%  .  .  .  that followed a revised December report that now shows the PPI was up 0.3%, with prices for finished wholesale goods up 1.0% while margins of final services providers were 0.1% lower, a revised November report that shows the PPI was 0.1% higher, with prices for finished wholesale goods rising 0.3% while margins of final services providers decreased 0.2%, a revised October report that indicates the PPI was 0.5% higher, with prices for finished wholesale goods rising 0.6% and margins of final services providers rising 0.5%, and a revised September report that indicates the PPI was 0.3% higher, with prices for finished wholesale goods 0.4% higher and margins of final services providers 0.2% higher . . . revisions to prior reports with this release reflect the routine annual recalculation of seasonal adjustment factors and affect previously published seasonally adjusted indexes and percent changes for January 2016 through December 2020; it appears that at least part of the reason for the large jump in January producer prices was due a recalibration of weight allocations used to calculate the overall indexes to more accurately reflect recent sales patterns, which would have thus increased the weighting of commodities and services in greatest demand  .  .  .  on an unadjusted basis, producer prices are now 1.7% higher than a year ago, up from the 0.8% year over year increase indicated by last month’s report, while, the core producer price index, which excludes food, energy and trade services, rose by 1.2% for the month, and is now 2.0% higher than in January a year ago, up from the 1.1% year over year increase as was shown in December .

As noted, the price index for final demand for goods, aka ‘finished goods’, was 1.4% higher in January, after being a revised 1.0% higher in December, 0.3% higher in November, 0.6% higher in October, 0.4% higher in September, 0.4% higher in August, 0.5% higher in July, 0.4% higher in June, 1.4% higher in May, 2.8% lower in April, 1.7% lower in March, 0.7% lower in February, and 0.3% higher in January of last year, with all of those monthly figures revised . . . the finished goods price index rose 1.4% in January because the price index for wholesale energy goods was 5.1% higher, after it had risen by 4.9% in December, 1.3% in November, and by 0.8% in October, while the price index for wholesale foods rose 0.2%, after falling 0.2% in December, rising by 0.6% in November, by 1.9% in October, and by a revised 1.7% in September, while the index for final demand for core wholesale goods (excluding food and energy) was 0.8% higher, after rising by 0.5% in November . . . wholesale energy prices averaged 5.1% higher due to a 13.6% increase in wholesale prices for gasoline, a 7.6% increase in wholesale prices for No.2 diesel fuel, and a 21.8% increase in wholesale prices for liquefied petroleum gas .  .  .  meanwhile, the wholesale food price index rose 0.2% on a 19.0% increase in the wholesale price index for oilseeds, an 18.2% increase in the wholesale price index for grains, and a 11.3% increase in wholesale price index for fresh fruits and melons .  .  .  among core wholesale goods, the wholesale price index for industrial chemicals rose 7.0%, the wholesale price index for light motor trucks rose 1.5%, and the wholesale price index for iron and steel scrap rose 20.6% while the wholesale price index for communication equipment fell 1.7% .

At the same time, the index for final demand for services rose 1.3% in January, after falling by 0.1% in December, falling by 0.2% in November, rising by 0.5% in October, and rising by 0.2% in September, as the index for final demand for trade services rose 1.0%, the index for final demand for transportation and warehousing services rose 1.3%, and the core index for final demand for services less trade, transportation, and warehousing services was 1.4% higher .  .  . among trade services, seasonally adjusted margins for apparel, jewelry, footwear, and accessories retailers rose 5.3%, margins for TV, video, and photographic equipment and supplies retailers rose 11.1%, and margins for machinery and vehicle wholesalers rose 4.2%, while margins for automobile retailers fell 7.7%.. among transportation and warehousing services, average margins for rail transportation of passengers rose 1.7% while average margins for truck transportation of freight rose 2.2% .  .  .  among the components of the core final demand for services index, the index for portfolio management rose 9.4%, the index for management, scientific, and technical consulting services rose 16.1%, and margins for traveler accommodation services rose 13.3%, while margins for property and casualty insurance fell 1.7%.

This report also showed the price index for intermediate processed goods rose 1.7% in January, after rising a revised 1.4% in December, 1.3% in November, 0.3% in October, 0.6% in September, 0.9% in August, 1.4% in July, and 1.4% in June, but after being unchanged in May and falling the prior 5 months .  .  .  the price index for intermediate energy goods rose 2.0%, as refinery prices for gasoline rose 13.6%, refinery prices for residual fuels rose 18.6%, and producer prices for liquefied petroleum gas rose 21.8%, while producer prices for natural gas to electric utilities fell 21.1%  .  .  . meanwhile, the price index for intermediate processed foods and feeds rose 0.1%, as the producer price index for fats and oil rose 3.3% and the producer price index for prepared animal feeds rose 1.2%…at the same time, the core price index for intermediate processed goods less food and energy rose 1.8% as the producer price index for industrial chemicals rose 7.0%, the producer price index for steel mill products rose 5.2%, the producer price index for paving mixtures and blocks rose 4.1%, and the producer price index for softwood lumber rose 13.9% . . . prices for intermediate processed goods are now 3.1% higher than in January a year ago, the second increase after 19 consecutive year over year decreases, which followed 29 months of year over year increases, which had been preceded by 16 months of negative year over year comparisons, as prices for intermediate goods fell every month from July 2015 through March 2016.

Meanwhile, the price index for intermediate unprocessed goods rose 3.8% in January, after rising a revised 2.2% in December, 7.4% in November, 0.3% in October, 4.2% in September, a revised 4.0% in August 0.6% in July, 5.4% in June and 8.4% in May, but after falling a revised 13.7% in April and 8.1% in March….that was as the January price index for crude energy goods rose 5.3% as crude oil prices rose 12.0% while unprocessed natural gas prices fell 0.9%, while the price index for unprocessed foodstuffs and feedstuffs fell 1.2% on an 20.4% drop in the price of raw milk, a 13.0% decrease in the price of slaughter chickens, and a 4.9% decrease in the price of slaughter hogs…at the same time, the index for core raw materials other than food and energy materials rose 8.9%, as producer prices for recyclable paper rose 7.9%, the price index for iron and steel scrap rose 20.6%, the price for aluminum base scrap rose 9.3%, and raw cotton prices rose 7.9%… this raw materials index is now 6.6% higher than a year ago, the third annual increase in 2 years, as the year over year change on this index had been negative from the beginning of 2019 through October of last year.

Lastly, the price index for services for intermediate demand rose 1.3% in January, after rising 0.4% in December, falling 0.1% in November, rising 0.6% in October, rising 1.1% in September, 0.8% in August, 0.5% in July, and 0.3% in June . . .the price index for intermediate trade services was 1.1% higher, as margins for metals, minerals, and ores wholesalers rose 11.4% and margins for intermediate paper and plastics products wholesalers rose 1.4%…meanwhile, the index for transportation and warehousing services for intermediate demand was 0.4% higher, as the intermediate price index for truck transportation of freight rose 2.2% and the intermediate price index for air mail and package delivery services, not including by USPS, rose 1.3%…at the same time, the core price index for intermediate services less trade, transportation, and warehousing rose 1.5%, as the intermediate price index for administrative and general management consulting services jumped 22.9%, the intermediate price index for traveler accommodation services rose 13.3% and the intermediate price index for portfolio management rose 9.4% . . . over the 12 months ended in January, the year over year price index for services for intermediate demand is 2.8% higher than it was a year ago, the fifth consecutive positive annual change since it turned negative year over year in April for the first time in the history of this index.

The seasonally adjusted Producer Price Index (PPI) for final demand rose 1.3% in January, as prices for finished wholesale goods were on average 1.4% higher, while margins of final services providers increased by 1.3%…that followed a revised December report that now shows the PPI was up 0.3%, with prices for finished wholesale goods up 1.0% while margins of final services providers were 0.1% lower, a revised November report that shows the PPI was 0.1% higher, with prices for finished wholesale goods rising 0.3% while margins of final services providers decreased 0.2%, a revised October report that indicates the PPI was 0.5% higher, with prices for finished wholesale goods rising 0.6% and margins of final services providers rising 0.5%, and a revised September report that indicates the PPI was 0.3% higher, with prices for finished wholesale goods 0.4% higher and margins of final services providers 0.2% higher . . . revisions to prior reports with this release reflect the routine annual recalculation of seasonal adjustment factors and affect previously published seasonally adjusted indexes and percent changes for January 2016 through December 2020; it appears that at least part of the reason for the large jump in January producer prices was due a recalibration of weight allocations used to calculate the overall indexes to more accurately reflect recent sales patterns, which would have thus increased the weighting of commodities and services in greatest demand . . . on an unadjusted basis, producer prices are now 1.7% higher than a year ago, up from the 0.8% year over year increase indicated by last month’s report, while, the core producer price index, which excludes food, energy and trade services, rose by 1.2% for the month, and is now 2.0% higher than in January a year ago, up from the 1.1% year over year increase as was shown in December.

As noted, the price index for final demand for goods, aka ‘finished goods’, was 1.4% higher in January, after being a revised 1.0% higher in December, 0.3% higher in November, 0.6% higher in October, 0.4% higher in September, 0.4% higher in August, 0.5% higher in July, 0.4% higher in June, 1.4% higher in May, 2.8% lower in April, 1.7% lower in March, 0.7% lower in February, and 0.3% higher in January of last year, with all of those monthly figures revised…the finished goods price index rose 1.4% in January because the price index for wholesale energy goods was 5.1% higher, after it had risen by 4.9% in December, 1.3% in November, and by 0.8% in October, while the price index for wholesale foods rose 0.2%, after falling 0.2% in December, rising by 0.6% in November, by 1.9% in October, and by a revised 1.7% in September, while the index for final demand for core wholesale goods (excluding food and energy) was 0.8% higher, after rising by 0.5% in November wholesale energy prices averaged 5.1% higher due to a 13.6% increase in wholesale prices for gasoline, a 7.6% increase in wholesale prices for No.2 diesel fuel, and a 21.8% increase in wholesale prices for liquefied petroleum gas . . . meanwhile, the wholesale food price index rose 0.2% on a 19.0% increase in the wholesale price index for oilseeds, an 18.2% increase in the wholesale price index for grains, and a 11.3% increase in wholesale price index for fresh fruits and melons . . . among core wholesale goods, the wholesale price index for industrial chemicals rose 7.0%, the wholesale price index for light motor trucks rose 1.5%, and the wholesale price index for iron and steel scrap rose 20.6% while the wholesale price index for communication equipment fell 1.7% .

At the same time, the index for final demand for services rose 1.3% in January, after falling by 0.1% in December, falling by 0.2% in November, rising by 0.5% in October, and rising by 0.2% in September, as the index for final demand for trade services rose 1.0%, the index for final demand for transportation and warehousing services rose 1.3%, and the core index for final demand for services less trade, transportation, and warehousing services was 1.4% higher . . . among trade services, seasonally adjusted margins for apparel, jewelry, footwear, and accessories retailers rose 5.3%, margins for TV, video, and photographic equipment and supplies retailers rose 11.1%, and margins for machinery and vehicle wholesalers rose 4.2%, while margins for automobile retailers fell 7.7% . . . among transportation and warehousing services, average margins for rail transportation of passengers rose 1.7% while average margins for truck transportation of freight rose 2.2% . . . among the components of the core final demand for services index, the index for portfolio management rose 9.4%, the index for management, scientific, and technical consulting services rose 16.1%, and margins for traveler accommodation services rose 13.3%, while margins for property and casualty insurance fell 1.7%.

This report also showed the price index for intermediate processed goods rose 1.7% in January, after rising a revised 1.4% in December, 1.3% in November, 0.3% in October, 0.6% in September, 0.9% in August, 1.4% in July, and 1.4% in June, but after being unchanged in May and falling the prior 5 months . . . the price index for intermediate energy goods rose 2.0%, as refinery prices for gasoline rose 13.6%, refinery prices for residual fuels rose 18.6%, and producer prices for liquefied petroleum gas rose 21.8%, while producer prices for natural gas to electric utilities fell 21.1% . . . meanwhile, the price index for intermediate processed foods and feeds rose 0.1%, as the producer price index for fats and oil rose 3.3% and the producer price index for prepared animal feeds rose 1.2%…at the same time, the core price index for intermediate processed goods less food and energy rose 1.8% as the producer price index for industrial chemicals rose 7.0%, the producer price index for steel mill products rose 5.2%, the producer price index for paving mixtures and blocks rose 4.1%, and the producer price index for softwood lumber rose 13.9% . . . prices for intermediate processed goods are now 3.1% higher than in January a year ago, the second increase after 19 consecutive year over year decreases, which followed 29 months of year over year increases, which had been preceded by 16 months of negative year over year comparisons, as prices for intermediate goods fell every month from July 2015 through March 2016.

Meanwhile, the price index for intermediate unprocessed goods rose 3.8% in January, after rising a revised 2.2% in December, 7.4% in November, 0.3% in October, 4.2% in September, a revised 4.0% in August 0.6% in July, 5.4% in June and 8.4% in May, but after falling a revised 13.7% in April and 8.1% in March . . . that was as the January price index for crude energy goods rose 5.3% as crude oil prices rose 12.0% while unprocessed natural gas prices fell 0.9%, while the price index for unprocessed foodstuffs and feedstuffs fell 1.2% on an 20.4% drop in the price of raw milk, a 13.0% decrease in the price of slaughter chickens, and a 4.9% decrease in the price of slaughter hogs . . . at the same time, the index for core raw materials other than food and energy materials rose 8.9%, as producer prices for recyclable paper rose 7.9%, the price index for iron and steel scrap rose 20.6%, the price for aluminum base scrap rose 9.3%, and raw cotton prices rose 7.9% . . . this raw materials index is now 6.6% higher than a year ago, the third annual increase in 2 years, as the year over year change on this index had been negative from the beginning of 2019 through October of last year.

Lastly, the price index for services for intermediate demand rose 1.3% in January, after rising 0.4% in December, falling 0.1% in November, rising 0.6% in October, rising 1.1% in September, 0.8% in August, 0.5% in July, and 0.3% in June . . . the price index for intermediate trade services was 1.1% higher, as margins for metals, minerals, and ores wholesalers rose 11.4% and margins for intermediate paper and plastics products wholesalers rose 1.4% . . . meanwhile, the index for transportation and warehousing services for intermediate demand was 0.4% higher, as the intermediate price index for truck transportation of freight rose 2.2% and the intermediate price index for air mail and package delivery services, not including by USPS, rose 1.3% . . . at the same time, the core price index for intermediate services less trade, transportation, and warehousing rose 1.5%, as the intermediate price index for administrative and general management consulting services jumped 22.9%, the intermediate price index for traveler accommodation services rose 13.3% and the intermediate price index for portfolio management rose 9.4% . . . over the 12 months ended in January, the year over year price index for services for intermediate demand is 2.8% higher than it was a year ago, the fifth consecutive positive annual change since it turned negative year over year in April for the first time in the history of this index.

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