In the United States of America, producer prices increased significantly more than expected in the month of September. On the other hand, the prices of goods showed minimal figures in the nearly few years with the improving supply chains. This added a few hopes to tackle inflation.
A report from the Labor Department says that the producers might be in a situation, where they are finding it difficult to raise higher prices, with a certain amount of margins gained by wholesalers along with retailers struggling to rise last month. There is also a moderate recorded increase in intermediate goods and services.
Christopher Rupkey, the FWDBONDS economist, located in New York said, “Inflation is all about pass-through costs at the lower level of production, so this report counts as some relief for beleaguered consumers who face runaway inflation on the goods sitting on store shelves”. The report also added that the war of the Fed on inflation is far from victory, but the cost of the goods from the level of the producer has ceased to rise which was out of control last year.
Read Also– Going deep with the idea of lean startup by Eric Ries
Current Situation :
The PPI or producers’ price index rebounded at about 0.4% in the last month. In August the PPI was at 0.2% fall instead of 0.1% as from the reports. A Reuters report of economists clocked PPI to rise 0.2%. A 0.4% rise in the services price accounted for about a two-thirds increase in September’s PPI figures. Also in September, the prices of accommodation in hotels and motels had a 6.4% surge.
The cost of food, alcohol, drilling services of oil and gas, inpatient care in hospitals, and many others increased. On the other hand, fuel, consumer loans, and freight for long distances are reduced. Services in transportation and warehouse slipped about 0.2%, which is the third month of reduced rates.
Goods prices rose 0.4% after a decline of 1.1% in the month of August. Due to a 1.2% rise in food prices, there was a 60% raise in goods. There was a surge of 15.7% in the prices of fresh vegetables which boosted food prices. The prices of eggs pork and chicken also increased.
Key Takeaways :
The petrol and diesel prices, consumer natural gas, and house heating oil increased by 0.7% with the wholesale gasoline price decreasing by 2.0%. The rates of core goods increased by 7.5% in the total 12 months including September. After peaking in the month of April at about 10.2%, the annual price of core goods decelerated.
Stocks in Wall Street gained traction and got steady against other currencies. Supply chain management got better with a rise of 8.5%. Last OPEC+ came to a decision to cut crude oil production along with the Russia-Ukraine war to be a pivotal factor in the rise of commodity prices.
In New York, Will Compernolle, FHN Financial’s senior economist said “Improvement in supply chains have cooled core goods prices, but price pressures everywhere else are a reminder that supply chain healing is insufficient to bring down overall price inflation”.
Read More– As alarming as it is but US inflation rates is at a 40-year high
