US producer prices rise more sharply than expected in April
By Alexander Bueso
Date: Thursday 11 May 2017
(ShareCast News) - Factory gate inflation in the US accelerated last month as energy prices rebounded amid a pick-up in services prices.
Total producer prices in the States rose by 0.5% in April when compared to the previous month and were up 2.5% versus the year-earlier period, according to the Bureau of Labor Statistics.
Economists had penciled in a rise of 0.2% month-on-month and 2.1% year-on-year.
Prices for food rose by 0.9% on the month, the same as in April, alongside gains of 0.8% in those of energy.
Energy prices fell 2.9% in March.
Core goods prices on the other hand, which excludes those for food and energy, advanced by 0.3% month-on-month following a gain of 0.4% in the month before.
Excluding food, energy and trade services, prices increased by 0.8% on the month and 2.1% on the year.
Service price inflation rose by 0.4% after dipping by 0.1% in March.
In comparison to the year-earlier period, producer prices were ahead by 2.1% versus an advance of 1.7% in the month before.
"The rebound across the PPI components in the April report suggest much of the weakness in the previous month is likely a blip, and we view it as a sign that the upward momentum in pipeline price pressures is sustained.
"We expect inflation pressures to remain solid in the economy, as labor markets continue to tighten and the dollar and commodity prices are broadly stable," said analysts at Barclays Research.
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