PiCK

US February producer prices rise 0.7% m/m, topping forecasts

JOON HYOUNG LEE

Summary

The US producer price index (PPI) rose 0.7% from the previous month in February, beating the 0.3% economists’ forecast.
Core PPI, excluding volatile items, increased 0.5% m/m, extending gains to 10 consecutive months and topping the 0.3% forecast.
The PPI, known as wholesale inflation, is a leading indicator of consumer inflation and is incorporated into the Federal Reserve’s key gauge, the personal consumption expenditures (PCE) price index.

Forecast Trend Report by Period

US wholesale prices in February last year came in above market expectations.

The Bureau of Labor Statistics at the US Department of Labor said on the 18th (local time) that the producer price index (PPI) rose 0.7% from the previous month in February. The reading was 0.4% points higher than the 0.3% consensus forecast compiled by Dow Jones.

A 1.1% m/m increase in final demand services prices led the overall rise in the index. The year-on-year gain was 3.4%.

Core PPI, which excludes volatile items such as energy, food and trade services, rose 0.5% from the previous month. That was 0.2% points above economists’ forecast of 0.3%, marking a 10th straight monthly increase. It was up 3.5% from a year earlier.

The PPI, also known as wholesale inflation, is reflected in final consumer goods prices with a time lag and is regarded as a leading indicator of consumer inflation. It is also incorporated into the personal consumption expenditures (PCE) price index, which the US Federal Reserve (Fed) uses as a key inflation gauge.

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