Core PPI for April up by 0.4%, ahead of 0.2% consensus. (Headline PPI up by 0.2%, lower than 0.4% consensus. An unexpected decrease in fuel and energy costs and an increase in automobile and furniture costs drove the headline figure below the core figure. Bloomberg:
The 0.4 per cent gain in so-called core prices was twice as big as anticipated and followed a 0.2 per cent increase in March, the labour Department said today in Washington. A drop in energy costs and unchanged food expenses held overall prices to a 0.2 per cent gain.
Soaring raw material costs may force companies to raise prices to protect profits. The increases may heighten concern among Federal Reserve policy makers that prior increases in food and fuel costs will filter through the economy even as growth slows.
“Back in the producer pipeline, there’s still a lot of inflationary pressures from materials,” Stuart Hoffman, chief economist at PNC Financial in Pittsburgh, said before the report.
Economists forecast producer prices would rise 0.4 per cent, according to the median of 70 projections in a Bloomberg News survey. Estimates ranged from no change to a 1 per cent gain.
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