The Producer Price Index (PPI) measures wholesale inflation, and the April readings are mostly in line with those from March. The headline PPI for final demand was up 0.6% in April, above the 0.2% reading expected by Bloomberg and up marginally from the 0.5% headline reading for March.
The core reading, excluding food and energy, was up by 0.5% in April. This compared to a Bloomberg consensus estimate from economists of 0.2% and was down by one-tenth of one-percent from the 0.6% reading from March.
Where the reading gets less inflationary is when you back out food and energy and the so-called trade services. This was only a gain of 0.3% in April. Economists do not guess that reading yet, but it was flat from the 0.3% reading from March.
Both readings for goods and for services were up by 0.6% in April.
We would caution that, while these still seem low and under the Federal Reserve’s inflation target, that February’s PPI readings were negative. These will not be deemed inflationary by much of a measure.
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