U.S. JUNE PRODUCER PRICES RISE 0.1%; CORE RATE CLIMBS 0.2%

Econoday was expecting readings of -0.4% for PPI and +0.2% for PPI Less Food & Energy.

BLS Release:

http://bls.gov/news.release/ppi.nr0.htm

Partial quote (without tables):

Quote:

PRODUCER PRICE INDEXES - JUNE 2012


The Producer Price Index for finished goods increased 0.1 percent in June, seasonally adjusted,
the U.S. Bureau of Labor Statistics reported today. Prices for finished goods moved down 1.0
percent in May and declined 0.2 percent in April. At the earlier stages of processing, prices
received by manufacturers of intermediate goods decreased 0.5 percent in June, and the crude
goods index fell 3.6 percent. On an unadjusted basis, prices for finished goods advanced 0.7
percent for the 12 months ended in June, the same rate as in May. (See table A.)

Stage-of-Processing Analysis

Finished goods

In June, the increase in finished goods prices was led by the index for finished goods less foods
and energy, which moved up 0.2 percent. Prices for finished consumer foods rose 0.5 percent. By
contrast, the index for finished energy goods declined 0.9 percent.

Finished core: In June, prices for finished goods less foods and energy advanced 0.2 percent
for the fourth consecutive month. Accounting for seventy percent of the June increase, the index
for light motor trucks moved up 1.4 percent. Higher prices for major household appliances and
pet food also contributed to the rise in the finished core index. (See table 2.)

Finished foods: The index for finished consumer foods moved up 0.5 percent in June, the
largest advance since a 1.0-percent rise in November 2011. Over ninety percent of the June
increase can be traced to prices for meats, which moved up 3.1 percent. An advance in the index
for fresh and dry vegetables also was a factor in the rise in finished foods prices.

Finished energy: In June, prices for finished energy goods fell 0.9 percent, the fourth straight
decline. The residential electric power index was a significant factor in the June decrease,
dropping 2.1 percent.

Intermediate goods

The Producer Price Index for intermediate materials, supplies, and components fell 0.5 percent in
June, the third consecutive decline. Most of the June decrease can be attributed to a 0.7-percent
drop in prices for intermediate goods less foods and energy. The index for intermediate energy
goods moved down 0.2 percent. By contrast, prices for intermediate foods and feeds advanced
1.0 percent. For the 12 months ended in June, the intermediate goods index fell 1.3 percent, the
largest decrease since a 1.8-percent decline for the 12 months ended November 2009. (See table
B.)

Intermediate core: The index for intermediate goods less foods and energy fell 0.7 percent in
June, the largest decline since a 0.7-percent decrease in February 2009. Over sixty percent of the
June decline can be traced to the index for industrial chemicals, which fell 3.6 percent. Lower
prices for plastic resins and materials and for steel mill products also were factors in the decrease
in the intermediate core index. (See table 2.)

Intermediate energy: Prices for intermediate energy goods moved down 0.2 percent in June,
the third consecutive decrease. Most of the June decline can be attributed to an 8.8-percent drop
in the index for diesel fuel. Lower prices for lubricating oil base stocks also contributed to the
decrease in the intermediate energy goods index.

Intermediate foods: The index for intermediate foods and feeds climbed 1.0 percent in June,
the largest advance since a 1.4-percent increase in August 2011. More than half of the June rise
can be traced to a 2.2-percent advance in prices for prepared animal feeds.

Crude goods

The Producer Price Index for crude materials for further processing fell 3.6 percent in June. For
the 3 months ended in June, prices for crude materials dropped 10.8 percent after moving down
0.9 percent from December to March. In June, over half of the broad-based monthly decline can
be traced to a 5.1- percent decrease in the index for crude energy materials. Prices for crude
nonfood materials less energy and for crude foodstuffs and feedstuffs also fell in June - 4.0
percent and 1.6 percent, respectively. (See table B.)

Crude energy: The index for crude energy materials moved down 5.1 percent in June. From
March to June, prices for crude energy materials dropped 16.0 percent, compared with an 8.5-
percent decrease for the 3 months ended in March. Most of the monthly decline in June is
attributable to the crude petroleum index, which fell 11.7 percent. Lower prices for coal also
were a factor in the decrease in the crude energy index. (See table 2.)

Crude core: Prices for crude nonfood materials less energy declined 4.0 percent in June. For the
3 months ended in June, the index for crude nonfood materials less energy fell 7.0 percent
following a 2.5-percent increase from December to March. Over eighty percent of the monthly
decrease in June can be traced to a 12.8-percent drop in the index for carbon steel scrap. Lower
prices for raw cotton also contributed to the decline in crude core prices.

Crude food: The index for crude foodstuffs and feedstuffs decreased 1.6 percent in June. From
March to June, prices for crude foodstuffs and feedstuffs fell 7.2 percent, compared with a 5.1-
percent rise for the 3 months ended in March. About half of the monthly decline in June is
attributable to the index for slaughter poultry, which moved down 6.1 percent. Lower prices for
slaughter cattle also were a major factor in the decrease in the index for crude foodstuffs and
feedstuffs.

Services Analysis

Trade industries: The Producer Price Index for the net output of total trade industries was
unchanged in June following five consecutive increases. (Trade indexes measure changes in
margins received by wholesalers and retailers.) In June, higher margins received by warehouse
clubs and supercenters and by electronic shopping and mail-order houses were offset by lower
margins received by family clothing stores and gasoline stations with convenience stores.

Transportation and warehousing industries: The Producer Price Index for the net output of
transportation and warehousing industries moved down 0.2 percent in June, the first decrease
since a 0.5-percent drop in September 2011. Accounting for a majority of the June decline, prices
received by the truck transportation sector fell 1.1 percent. Lower prices received by the industry
groups for air transportation support activities and nonscheduled air transportation also
contributed to the decrease in the transportation and warehousing industries index.

Traditional service industries: The Producer Price Index for the net output of total traditional
service industries edged up 0.1 percent in June after declining 0.2 percent in May. Leading the
June increase, the index for the commercial banking industry rose 1.3 percent. Higher prices
received by lessors of nonresidential buildings and by the accommodation sector also were
factors in the advance in the total traditional service industries index.