The U.S. Bureau of Labor Statistics released its latest Producer Price Index report on Thursday. The index for final demand stayed unchanged in July on a seasonally adjusted basis. This followed a revised 0.1 percent decline in June and a 0.5 percent rise in May.
On an unadjusted basis, the final demand index increased 4.7 percent over the 12 months ending in July. That marked a slowdown from the 5.5 percent annual gain recorded through June.
In July, prices for final demand goods fell 0.7 percent. This drop came after a 1.4 percent decrease in June. A 3.1 percent decline in final demand energy prices played a major role. Gasoline prices alone fell 5.7 percent and accounted for more than half of the overall goods decline. Final demand food prices also moved lower by 0.9 percent. Prices for final demand goods excluding foods and energy edged up 0.1 percent. Other categories that declined included diesel fuel, jet fuel, residual fuels, fresh and dry vegetables, and thermoplastic resins and materials. Prices for motor vehicles and equipment rose 0.3 percent, while electric power and grains also increased.
Prices for final demand services advanced 0.2 percent in July after a 0.5 percent rise the previous month. The gain traced mainly to a 0.6 percent increase in final demand services less trade, transportation, and warehousing. Portfolio management prices jumped 6.5 percent and led the services advance. Margins also rose for health, beauty, and optical goods retailing, automobiles and automobile parts retailing, lawn, garden, and farm equipment and supplies retailing, food and alcohol retailing, and food and alcohol wholesaling. In contrast, truck transportation of freight prices fell 1.8 percent. Final demand transportation and warehousing services declined 1.8 percent overall, while final demand trade services edged down 0.1 percent. Machinery and vehicle wholesaling along with securities brokerage, dealing, and investment advice also decreased.
Prices for final demand construction advanced 2.2 percent in July. This increase, together with the 0.2 percent rise in services, offset the 0.7 percent drop in goods prices and left the overall final demand index unchanged.
The index for final demand less foods, energy, and trade services rose 0.4 percent in July after a 0.1 percent increase in June. Over the 12 months ended in July, that measure advanced 4.7 percent.
The Bureau of Labor Statistics noted that some figures for March through June reflect revisions based on late reports and corrections from respondents. Data collection for the July report occurred mostly early in the month.
