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'Transitory' - Core Producer Price Inflation Falls Back Below Fed Mandate

With The Fed convinced any downturn in inflation is 'transitory' - due to wireless carrier discounting, or oil ups and downs - today's Core PPI fell back below the 'mandated' 2.0% level after one brief shining month above it. Producer prices ex food and fuel rose just 1.9% YoY, slowing from last month's 2.1% rise.

This is the 3rd time in5 years that Core PPI has managed just one month above The Fed's mandate and faded...

 

Under the covers shows some interesting standouts...

A major factor in the June increase in the index for final demand services was prices for securities brokerage, dealing, investment advice, and related services, which rose 4.0 percent.

The indexes for machinery and equipment wholesaling, loan services (partial), insurance, inpatient care, and truck transportation of freight also advanced. Conversely, margins for apparel, footwear, and accessories retailing declined 3.7 percent. The indexes for motor vehicle maintenance and repair (partial) and for airline passenger services also fell.

Leading the June advance in the index for final demand goods, prices for meats increased 5.5 percent. The indexes for pharmaceutical preparations, light motor trucks, young chickens, potatoes, and butter also moved higher. Conversely, prices for gasoline moved down 1.1 percent. The indexes for fresh vegetables (except potatoes), plastic resins and materials, and unprocessed finfish also fell.

It appears those new eTrade commercials are paying off!!