Prices received by U.S. businesses for goods and services rose by much more than expected in June, the Labor Department reported Tuesday.
The Producer Price Index rose 7.3 percent in June from 12 months earlier, the largest demand since 12-month data were first introduced in 2010. Compared with May, the index rose one percent. On average, this index rose by around 0.2 percent per month in the pre-pandemic Trump administration.
Economists had been expecting an increase of 0.6 percent, below the 0.8 percent initially reported for May. On a 12-month basis, the consensus forecast was for 6.8 percent.
Nearly 60 percent of the June advance in the index can be traced to a 0.8-percent increase in prices for final demand services. The index for final demand goods moved up 1.2
percent. Seventy percent of PPI’s gain is attributable to margins for trade services, which moved up 2.1 percent. (Trade services measure changes in margins received by wholesalers and retailers rather than changes in prices.)
Twenty percent of the June increase in the services index can be traced to margins for automobiles and automobile parts retailing, which rose 10.5 percent.- READ MORE
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