Home   Logon   Mobile Site   Research and Commentary   About Us   Call 1.800.621.1675 or Email Us       Follow Us: 

Search by Ticker, Keyword or CUSIP       

Blog Home
   Brian Wesbury
Chief Economist
Click for Bio
Follow Brian on Twitter Follow Brian on LinkedIn View Videos on YouTube
   Bob Stein
Deputy Chief Economist
Click for Bio
Follow Bob on Twitter Follow Bob on LinkedIn View Videos on YouTube
  The Producer Price Index Declined 0.1% in March
Posted Under: Data Watch • Inflation • PPI
Supporting Image for Blog Post


Implications:  March was an unusual month for the producer price index, with service prices falling for the first time in five months while goods prices rose for the first time since last June.  On net, producer prices declined 0.1% in March, and are also down 0.1% in the past year.  The 0.2% decline in service prices in March was almost entirely due to declining margins in trade services (among wholesalers and retailers).  Goods prices moved higher in March, led by energy, which rose 1.8%.  And given the trend in oil prices through the first half of April, it looks like energy will push goods prices higher in next month's report as well.  While the Fed pays attention to the overall index, they place a greater weight on "core" prices, which exclude the volatile food and energy components.  In March, a 0.9% decline in food prices, offset the gain in energy, resulting in the "core" measure showing a 0.1% decline, but these prices remain up 1.0% in the past year.  So while inflation remains modest, the U.S. is not experiencing deflation, and rising energy prices may push inflation up at a faster pace than many are expecting.  In short, the Fed shouldn't view the lack of headline inflation as a reason to hold off on further rate hikes.  In other recent news, import prices rose 0.2% in March but remain down 6.2% from a year ago.  The drop is mostly from petroleum, but not all of it; import prices are down 2.7% from a year ago even excluding petroleum.  Export prices were unchanged in March and are down 6.1% from a year ago.

Click here for PDF version

Posted on Wednesday, April 13, 2016 @ 9:44 AM • Post Link Share: 
Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2022 All rights reserved.