2017 Economic Calendar
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Released On 6/13/2017 8:30:00 AM For May, 2017
PriorConsensusConsensus RangeActual
PPI-FD - M/M change0.5 %0.1 %-0.2 % to 0.2 %0.0 %
PPI-FD - Y/Y change2.5 %2.4 %
PPI-FD less food & energy - M/M change0.4 %0.2 %0.1 % to 0.3 %0.3 %
PPI-FD less food & energy - Y/Y change1.9 %2.1 %
PPI-FD less food, energy & trade services - M/M change0.7 %-0.1 %
PPI-FD less food, energy & trade services - Y/Y change2.1 %2.1 %

Producer prices are mixed showing no pressure overall, unchanged in May, but tangible pressure when excluding food and energy at a higher-than-expected increase of 0.3 percent. Energy fell 3.0 percent in the month with food down 0.2 percent yet an apparent positive is a 0.3 percent gain for services with the closely watched trade services component up 1.1 percent after two months of declines. Yet this gain may not be tied to an actual increase in demand but rather to higher margins for producers who are benefiting from lower energy prices. When excluding food, energy and services, prices edged 0.1 percent lower.

This report proved unusually strong in April but was followed by weak inflation readings at the consumer level. The methodology of this report, which measures margins, often makes it difficult to read, yet the service readings in this report do offer cover for Federal Reserve policy makers who appear set to hike their target rate this week. Year-on-year rates show a 2.4 percent rate overall and a 2.1 percent less food and energy rate that is up 2 tenths in the month.

Consensus Outlook
Following unusual weakness in March, producer prices rebounded sharply in April and got a seasonal lift from guest rooms and also a lift at brokerages and loan firms following the Fed's rate hike in March. But trade services were weak, hinting at general weakness in demand and trouble for May's producer price report. Energy wasn't a major factor in April and isn't expected to be one in May either. Econoday's consensus gain for May's PPI-FD is 0.1 percent at the headline level (vs April's 0.5 percent) with less food & energy seen at plus 0.2 percent (vs 0.4 percent).

The Producer Price Index (PPI) of the Bureau of Labor Statistics (BLS) is a family of indexes that measures the average change over time in the prices received by domestic producers of goods and services. PPIs measure price change from the perspective of the seller. Effective with the January 2014 PPI data release in February 2014, BLS transitioned from the Stage of Processing (SOP) to the Final Demand-Intermediate Demand (FD-ID) aggregation system. The headline PPI (for Final Demand) measures price changes for goods, services, and construction sold to final demand: personal consumption, capital investment, government purchases, and exports.  Why Investors Care
With the redefined and expanded PPI Final Demand series, energy still creates monthly volatility. However, services and construction have softened the headline and core numbers.
Data Source: Haver Analytics
Year-on-year change, both overall and when excluding food and energy, offers a more accessible view of trends than month-to-month change.
Data Source: Haver Analytics

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