Tuesday, November 16, 2004

CBS Reports Surge in Producer Prices -- Led by Food and Energy

8:30am 11/16/04
U.S. Oct. PPI surges 1.7%, most in 14 years By Rex Nutting
WASHINGTON (CBS.MW) -- U.S. producer prices increased 1.7 percent in October, the fastest rate in 14 years, the Labor Department estimated Tuesday. Most of the inflation in finished goods prices came from volatile food and energy categories. The core rate, which excludes food and energy, rose a more moderate 0.3 percent for the second straight month. The headline figure stunned Wall Street economists, who were expecting a much milder 0.6 percent gain in the producer price index and a 0.2 percent rise in the core rate. The PPI is now up 4.4 percent in the past 12 months; the core rate is up 1.8 percent in the past year.


Atrios is the economist, but this doesn't sound to me like good news. Food and energy are things even the poorest have to buy. Now, volatility in the price of food and energy is affecting the price of produced goods. Merry Xmas! Consume some more!