Producer Price Index September release with August 2023 Data

The BLS has released the July Producer Price Index Report.  (historical releases) 

The Producer Price Index for final demand increased 0.7 percent in August, seasonally adjusted, after rising 0.4 percent in July, the U.S. Bureau of Labor Statistics reported today. (See table A.) The August advance is the largest increase in final demand prices since moving up 0.9 percent in June 2022. On an unadjusted basis, the index for final demand rose 1.6 percent for the 12 months ended in August.

In August, 80 percent of the rise in final demand prices is attributable to a 2.0-percent jump in the index for final demand goods. Prices for final demand services advanced 0.2 percent.

The index for final demand less foods, energy, and trade services increased 0.3 percent in August, the same as in July. For the 12 months ended in August, prices for final demand less foods, energy, and trade services rose 3.0 percent, the largest advance since moving up 3.4 percent for the 12 months ended in April.

So, the story is about gasoline prices creating most of the PPI. This might be true, but the current forecast is up and not down for that commodity.

Everything is screaming some future relief, except for what drove the August PPI higher. September is shaping up as a repeat of August, imho.

Not the most scientific metric, but there is more pink than last month. Not saying inflation is about to accelerate, but not so sure that crude oil will taper off its current rise. And we should remember that yesterday's CPI report mentioned the impact of gasoline, but also indicated that energy prices were down compared to one year ago... current at 294.328, year ago at 305.372. Gasoline current... 336.979, year ago at 348.593.

So, if last month's PPI was impacted by energy and thereby distorting the number, then energy being cheaper this year than last... would indicate the YoY 1.6% is also distorted. In fact the release indicates the PPI excluding energy was 2.0%. 

That is not a bad number, imho. Things are indeed looking up... except for pump prices, which are also looking up, but not in a good way.