February 13, 2025

The Producer Price Index (PPI) for final demand in the U.S. increased by 0.4 percent in January on a seasonally adjusted basis, according to the U.S. Bureau of Labor Statistics. Prior to this, final demand prices had increased by 0.5 percent in December 2024 and 0.2 percent in November. Over the 12 months ended January 2025, the index for final demand rose by 3.5 percent on an unadjusted basis.

In January, the index for final demand saw a notable increase, driven primarily by a 0.3 percent rise in prices for final demand services and a 0.6 percent increase in the index for final demand goods.

Excluding foods, energy, and trade services, the index for final demand rose by 0.3 percent in January, following a 0.4 percent increase in December. Over the past 12 months, this index has advanced by 3.4 percent.

Final demand goods

In January, the index for final demand goods rose by 0.6 percent, marking the fourth consecutive monthly increase. This broad-based advance was largely driven by a 1.7 percent increase in prices for final demand energy. Additionally, the indexes for final demand foods and final demand goods excluding foods and energy rose by 1.1 percent and 0.1 percent, respectively.

A significant contributor to the rise in prices for final demand goods was a 10.4 percent increase in the index for diesel fuel. Other notable increases were seen in the indexes for chicken eggs, beef and veal, gas fuels, jet fuel, and communication and related equipment. On the other hand, prices for fresh and dry vegetables fell sharply by 22.3 percent, and the indexes for pharmaceutical preparations and residential electric power also decreased.

Final demand services

In January, the index for final demand services increased by 0.3 percent, marking the sixth consecutive monthly rise. This broad-based advance was largely driven by a 0.4 percent rise in prices for final demand services excluding trade, transportation, and warehousing. Additionally, the indexes for final demand transportation and warehousing services and for final demand trade services saw increases of 0.6 percent and 0.1 percent, respectively.

A significant portion of the January rise in the index for final demand services was due to a 5.7 percent increase in prices for traveler accommodation services. Other notable increases were seen in automobile retailing, truck transportation of freight, food and alcohol retailing, apparel and accessories retailing, and bundled wired telecommunications access services. Conversely, margins for fuels and lubricants retailing fell by 9.8 percent, and prices for securities brokerage, investment advice, and physician care also declined.

Disclaimer:

Analyst Certification – The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation(s) or view (s) expressed by that research analyst in this research report.

Company Disclosure – The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.