Producer prices unexpectedly fell.
The latest producer price index (PPI) showed that prices fell by 0.1% in March compared to the prior month, and fell by 0.1% compared to the prior year.
Core PPI fell by 0.1% over the last month, and by 1.0% over the last year.
Economists were expecting prices to rise by 0.2% in March compared to the prior month, and by 0.3% over the prior year.
Additionally, core prices were expected to rise by 0.1% over the last month, and by 1.3% over the last year.
“Turning to the details of the core PPI, the moderation was due mainly to services prices which moved down 0.2% and this can largely be attributed to a 0.5% decline in final demand trade services. This category measures margins for wholesalers and retailers and tends to be volatile month-month,” noted JP Morgan’s Zina Bushra Saijid after the report.
“More encouraging, was a third consecutive increase in core goods prices, up 0.1% over the month,” she continued. “While vehicle prices were soft (passenger cars: -0.5%, light rucks: 0.0.%), other core goods prices were on the firmer side including those of pharmaceutical preparations, construction machinery, and household furniture and appliances. Finally, construction prices edged up 0.1% following declines in the two months prior.”
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