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Producer Price Index Sees 0.2% Increase in October 2024

Producer Price Index Sees 0.2% Increase in October 2024

October's rise in the Producer Price Index reflects ongoing economic adjustments

By News Desk
Published - Nov 13, 2024, 11:30 PM ET
Last Updated - Nov 14, 2024, 08:47 AM EST

The Producer Price Index (PPI) for final demand recorded a 0.2% increase in October 2024, indicating sustained inflationary pressures within the economy. This follows a trend of modest rises observed in the preceding months, with a 0.1% increase in September and a 0.2% hike in August, as reported by the U.S. Bureau of Labor Statistics. Over the past year, the index has seen a total increase of 2.4% by October, demonstrating the persistent nature of price changes over this period.

The latest figures highlight a significant development in the index for final demand services, which rose by 0.3% in October. This contrasts the more subdued increase of just 0.1% in the prices for final demand goods. Within the services sector, a notable driver was the rise in portfolio management prices, which surged by 3.6%, countering a decline in apparel, footwear, and accessories retailing margins that fell by 3.7%.

Conversely, the index for final demand excluding volatile areas such as foods, energy, and trade services also climbed by 0.3% in October. This marks a consistent rise following a minor uptick of 0.1% in September, contributing to a considerable year-over-year increase of 3.5% through October.

Among industrial commodities, carbon steel scrap prices jumped by 8.4%, contributing to broader price increases, while liquefied petroleum gas showcased a dramatic 18.1% decline, underscoring the price volatility within the energy sector.

The report further explores intermediate demand patterns, revealing a 0.5% rise in processed goods for intermediate demand and a notable 4.1% increase in unprocessed goods. A significant factor was the hike in unprocessed energy materials, which saw prices spike by 9.9%, mimicking the surge seen in crude petroleum by 7.3%.

Additional findings point to an average value of $76.36 for quality changes in new passenger cars, showing a marked influence on manufacturer pricing strategies for 2025 models. For light trucks, this quality change estimation averaged higher at $96.79, hinting at enhanced consumer features contributing to price adjustments in this vehicle category.

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