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The Producer Price Index for final demand decreased 0.2 percent in December, seasonally adjusted, the
U.S. Bureau of Labor Statistics reported today. Final demand prices increased 0.3 percent in November and fell 0.4 percent in October. On an unadjusted basis, the final demand index fell 1.0 percent in 2015, after rising 0.9 percent in 2014. (See table A.)
In December, the decrease in the final demand index can be traced to a 0.7-percent decline in prices for final demand goods. In contrast, the index for final demand services moved up 0.1 percent.
Within intermediate demand, the index for processed goods fell 1.0 percent, prices for unprocessed goods dropped 3.0 percent, and the index for services rose 0.2 percent. (See tables B and C.)
Chart 1. One-month percent changes in selected PPI final demand price indexes, seasonally adjusted
Percent change
2.0
1.0
0.0
-1.0
-2.0
Dec'14 Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec'15 Final demand Final demand goods Final demand services
Chart 2. Twelve-month percent changes in selected PPI final demand price indexes, not seasonally adjusted
Percent change
3.0
0.0
-3.0
-6.0
Dec'14 Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec'15 Final demand Final demand goods Final demand services
Final Demand
Product detail: About half of the December drop in the index for final demand goods is attributable to prices for gasoline, which fell 8.3 percent. The indexes for meats, diesel fuel, chicken eggs, jet fuel, and fresh fruits and melons also moved lower. In contrast, prices for pharmaceutical preparations rose 1.1 percent. The indexes for fresh and dry vegetables and for home heating oil also increased. (See table 4.)
Product detail: Leading the December advance in the index for final demand services, prices for services related to securities brokerage and dealing jumped 30.3 percent. The indexes for machinery, equipment, parts, and supplies wholesaling; physician care; food retailing; and hospital inpatient care also moved higher. In contrast, margins for apparel, jewelry, footwear, and accessories retailing fell 3.4 percent. The indexes for loan services (partial); TV, video, and photographic equipment and supplies retailing; and airline passenger services also fell.
Intermediate Demand by Commodity Type
1.0 percent in December, the sixth consecutive decline. In December, 60 percent of the broad-based decrease can be traced to the index for processed energy goods, which dropped 3.5 percent. Prices for processed materials less foods and energy and for processed foods and feeds also moved down, falling
0.3 percent and 2.4 percent, respectively. In 2015, the index for processed goods for intermediate demand decreased 6.4 percent compared with a 2.6-percent decline in 2014. (See table B.)
Product detail: Almost half of the December decrease in the index for processed goods for intermediate demand is attributable to diesel fuel prices, which fell 23.4 percent. The indexes for gasoline, meats, processed eggs, jet fuel, and hot rolled steel sheet and strip also moved lower. Conversely, prices for commercial electric power advanced 0.7 percent. The indexes for primary basic organic chemicals and fluid milk products also increased. (See table 5.)
Product detail: Over three-quarters of the decline in the index for unprocessed goods for intermediate demand can be attributed to prices for crude petroleum, which dropped 16.0 percent. The indexes for slaughter cattle, ungraded chicken eggs, nonferrous metals, strawberries, and unprocessed finfish also fell. In contrast, raw milk prices climbed 8.0 percent. The indexes for natural gas and wastepaper also increased.
Services for intermediate demand: The index for services for intermediate demand advanced 0.2 percent in December following no change in the prior month. In December, the increase in the index for services for intermediate demand can be attributed to prices for services less trade, transportation, and warehousing for intermediate demand, which rose 0.5 percent. Conversely, the index for trade services for intermediate demand decreased 1.1 percent. Prices for transportation and warehousing services for intermediate demand were unchanged. In 2015, prices for services for intermediate demand advanced 0.5 percent after rising 1.8 percent in 2014. (See table C.)Product detail: In December, prices for television advertising time sales moved up 2.6 percent. The indexes for services related to securities brokerage and dealing; courier, messenger, and U.S. postal services; tax preparation and planning; passenger car rental; and hardware, building materials, and supplies retailing also advanced. In contrast, margins for metals, minerals, and ores wholesaling fell 7.7 percent. The indexes for business loans (partial) and airline passenger services also moved lower.
Intermediate Demand by Production Flow
BLS - U.S. Bureau of Labor Statistics issued this content on 2016-01-15 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 2016-01-15 13:37:16 UTC
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