Screaming Hot Producer Prices

Tuesday, February 26, 2008 | 11:33 AM

Jan_08_ppi
chart via brian jacobs

>

After too many months of inflation data telling anyone with a barely functioning cerebral cortex that significant price inflation was at hand, this month seems to have jarred the denialists into a very belated recognition of reality.

As the delightful chart porn above shows, the costs of materials for food, energy and finished goods is up significantly.

Bloomberg notes:

"Prices paid to U.S. producers rose more than twice as much as forecast in January, pushed up by higher fuel, food and drug costs, signaling inflation may keep accelerating even as growth slows.

The 1 percent increase followed a 0.3 percent drop in December, the Labor Department said in Washington. The median forecast in a Bloomberg News survey of economists was for a 0.4 percent gain. Excluding food and energy, so-called core wholesale prices climbed 0.4 percent, the most in almost a year."

Here's the money quote from BLS:

"From January 2007 to January 2008, the index for finished goods moved up 7.4 percent.  Over the same period, prices for finished energy goods climbed 22.6 percent, the index for finished consumer foods rose 8.3 percent, and prices for finished goods other than foods and energy advanced 2.3 percent. For the 12 months ended January 2008, the index for intermediate goods increased 8.8 percent, and prices for crude goods jumped 31.3 percent."

Jeebus! Finished energy products, +22.6%! Finshed consumer goods, +8.3%

Lag this . . .


>

Sources:

Producer Price Indexes - January 2008
http://www.bls.gov/news.release/ppi.nr0.htm

Producer Prices in U.S. Increase More Than Forecast
Bob Willis
Bloomberg, Feb. 26 2008
http://www.bloomberg.com/apps/news?pid=20601087&sid=aOQJ_vlxPtvE&

Tuesday, February 26, 2008 | 11:33 AM | Permalink | Comments (77) | TrackBack (0)
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Comments

Well I live in a world where I don't need to consumer oil/gas and I don't eat, so I'm fine. Obviously, margins can also stay at record levels since inflation isn't a concern for corporations.

Posted by: Lloyd | Feb 26, 2008 11:40:36 AM

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