August Producer Prices Softened By Food And Energy

Food and energy softened producer prices in August. The PPI for total final demand was unchanged after a 0.1 percent gain in July. Analysts expected no change for August. Total final demand excluding food & energy eased to 0.1 percent in August after rising 0.2 percent the month before. Expectations were for 0.1 percent. Total final demand excluding food, energy, and trade services increased 0.2 percent in August, matching the July rate.

The final demand services index climbed 0.3 percent in August after inching up 0.1 percent in July. Eighty percent of the August advance can be traced to a 0.3-percent rise in prices for final demand services less trade, transportation, and warehousing. The index for final demand transportation and warehousing services also increased 0.3 percent.

The index for final demand goods moved down 0.3 percent in August, the largest decrease since a 0.7-percent drop in April 2013. Over 80 percent of the August decline is attributable to prices for final demand energy, which fell 1.5 percent. The index for final demand foods decreased 0.5 percent.

On a seasonally adjusted year-ago basis, PPI final demand was up 1.8 percent in August versus 1.7 percent in July. Excluding food & energy, PPI final demand was up 1.6 percent, matching the July pace.