2018 Economic Calendar
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Released On 9/12/2018 8:30:00 AM For Aug, 2018
PriorConsensusConsensus RangeActual
PPI-FD - M/M change0.0 %0.2 %-0.1 % to 0.3 %-0.1 %
PPI-FD - Y/Y change3.3 %2.8 %
PPI-FD less food & energy - M/M change0.1 %0.2 %0.1 % to 0.3 %-0.1 %
PPI-FD less food & energy - Y/Y change2.7 %2.3 %
PPI-FD less food, energy & trade services - M/M change0.3 %0.2 %0.2 % to 0.3 %0.1 %
PPI-FD less food, energy & trade services - Y/Y change2.8 %2.9 %

Wages may have shown inflationary pressures in last week's employment report but prices at the base of the supply chain remain very subdued. Headline producer prices edged 0.1 percent lower in August as did the ex-food and ex-energy reading with ex-food, ex-energy and ex-trade services up only 0.1 percent. All of these readings are either at or below the low end of Econoday's consensus ranges.

Foods fell 0.6 percent in the month to outmatch a 0.4 rise in energy. Trade service prices posted a very sharp decline of 0.9 percent that follows a 0.8 percent drop in July. Year-on-year, this reading is only 0.8 percent higher and points to a reversal of pressures earlier this year at retailers and wholesalers.

Other readings include only a 0.1 percent rise in construction prices that belies complaints out of the sector over rising costs. Passenger cars did show pressure, up 0.7 percent in the month, but not light trucks which slipped 0.1 percent. Personal consumption measures, which offer hints at the next set of PCE price data, are flat, unchanged overall and also when excluding food and energy.

Tariff-impacted areas do continue to show pressure with steel mill products up 2.6 percent in August for a year-on-year increase of 18.6 percent, though aluminum mill shapes declined, down 2.1 percent on the month but still up 14.0 percent on the year. Fabricated metal products rose 2.2 percent in August for a yearly gain of 15.7 percent.

But metals aside, this report is remarkably benign and includes outright retreats in the overall year-on-year rate, down 5 tenths overall to 2.8 percent and down 4 tenths less food and energy to 2.3 percent. Today's results will not raise any concerns over tomorrow's consumer price report where only a 0.2 percent rise in the core rate is expected. Risks over inflation appear to be concentrated in the labor market and not the general economy, at least yet.

Consensus Outlook
An incremental 0.2 percent monthly increase is expected for the August producer price headline following a 0.3 percent increase in July. When excluding food and energy and also when excluding food, energy and trade services, 0.2 percent gains are also expected for both.

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
Monthly changes in producer prices can be volatile and difficult to read, often the result of food and energy costs where large monthly swings are common. Excluding food and energy offers a smoother view.
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

2018 Release Schedule
Released On: 1/112/153/144/105/96/137/118/99/1210/1011/912/11
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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