Friday, March 14, 2014

Producer Prices Fell 0.1% in February

Producer prices fell in February, the first decline in three months. Prices dropped a modest 0.1% from the month prior. Final demand for services declined – largely due to the harsh weather – putting downward pressure on prices. Producer prices are now just 0.9% above year-ago levels, down from 1.2% last month.

Prices for finished goods rose 0.4%, while finished services declined 0.3%. Crude products sharply rose 5.7%, the highest monthly jump in almost 4 years, driven by a 14.7% rise in energy prices.

The elevated energy prices should subside as the harsh weather ends. The overall tepid growth should pick up, but the report’s general weakness is worrisome, as near future reports may reveal weak growth too.

Read the BLS report.

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