November 14, 2024

The Producer Price Index (PPI) for final demand in the U.S. increased by 0.2 percent in October on a seasonally adjusted basis, according to the U.S. Bureau of Labor Statistics. Prior to this, final demand prices had increased by 0.1 percent in September and 0.2 percent in August. Over the 12 months ended in October, the index for final demand rose by 2.4 percent on an unadjusted basis.

In October, a 0.3-percent increase in the index for final demand services contributed significantly to the rise, while prices for final demand goods inched up by 0.1 percent.

Excluding the volatile categories of foods, energy, and trade services, the index for final demand less foods, energy, and trade services increased by 0.3 percent in October after a 0.1 percent increase in September. Over the 12 months ended in October, prices for final demand less foods, energy, and trade services rose by 3.5 percent.

Final demand goods

In October, prices for final demand goods inched up by 0.1 percent following two consecutive decreases. This advance was driven by a 0.3 percent rise in prices for final demand goods less foods and energy. Conversely, the indexes for final demand energy and for final demand foods declined by 0.3 percent and 0.2 percent, respectively.

On a product level, an 8.4 percent increase in the index for carbon steel scrap was a major factor in the advance in prices for final demand goods. The indexes for meats, diesel fuel, fresh and dry vegetables, and oilseeds also moved higher. In contrast, prices for liquefied petroleum gas fell by 18.1 percent. The indexes for chicken eggs, processed poultry, and ethanol also decreased.

Final demand services

In October, prices for final demand services increased by 0.3 percent, following a 0.2 percent rise in September. Leading the October increase, the index for final demand services less trade, transportation, and warehousing advanced by 0.3 percent. Margins for final demand trade services increased by 0.1 percent, while the index for transportation and warehousing services rose by 0.5 percent.

A 3.6 percent increase in the index for portfolio management significantly contributed to the rise in prices for final demand services in October. Other notable increases were seen in machinery and vehicle wholesaling, airline passenger services, computer hardware, software, and supplies retailing, outpatient care (partial), and cable and satellite subscriber services. In contrast, margins for apparel, footwear, and accessories retailing fell by 3.7 percent, with declines also observed in securities brokerage, dealing, investment advice, and truck transportation of freight.

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