Producer Price Index Shows Very Slight Increase

Energy prices may be up but producer prices are still not showing much life, up only 0.2 percent in April. Excluding food & energy, prices rose only 0.1 percent. Details are mostly soft with goods up 0.2 percent and services, which have not been showing any life at all, up only 0.1 percent. And energy prices didn't rise that much at all, up 0.2 percent in the month, with food down 0.3 percent. Year-on-year rates are also stalled, unchanged for the total reading and up only 0.9 percent for the core. Judging by this report, inflationary benefits from higher oil prices and the lower dollar have yet to take hold.

Recent History Of This Indicator:
March gains for oil prices did little to boost producer prices in March but are expected to have a positive effect in April with the consensus looking for a 0.3 percent gain. Excluding oil, however, and also excluding food, core prices are expected to show much less strength at only plus 0.1 percent. Service prices in this report showed no strength at all March, down 0.2 percent for the first decline since October. Another drop for service prices, regardless of strength at the headline level, would not improve the inflationary outlook.