US Producers: Prices up despite low energy rates

The Labour Department said its PPI rose 0.2% in July, slightly above the 0.1% increase projected by analysts


Afp August 15, 2015

NEW YORK: US producer prices edged up in July in spite of the drag of lower energy prices on many goods, according to government data. The Labour Department said its Producer Price Index (PPI) rose 0.2% in July, slightly above the 0.1% increase projected by analysts. Lower energy prices affected several product categories, such as residential natural gas, leading to a smaller PPI increase in July compared with the 0.4% gain in June and a 0.5% increase in May. Categories with gains included hotel and guestroom rentals, which jumped 9.9%. Excluding food and energy prices, which are volatile, producer prices rose 0.3% in July, more than the 0.1% seen by analysts. The Federal Reserve has spotlighted the need for stronger inflation as a leading condition to increase interest rates. “Much to the chagrin of central bankers, the downward trend in wholesale inflation looks set to get worse as oil sinks to its lowest level in over six years,” said FTN Financial economist Jay Morelock.

Published in The Express Tribune, August 15th, 2015.

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