Producer Prices in the US (less the all important food and energy – which no on uses) fell 0.2% month-over-month - the biggest drop since July 2013 – and missing expectations of a 0.1% rise. This is only the third month of ‘disinflation in the last 18 months. Perhaps even more relevant is the dramatic slowdown in prices for final demand services which dropped 0.3% (the biggest drop since May 2013) and equal slowest rise year-over-year since the ‘recovery’ began.
Core PPI (ex food and energy)…
And Final Demand Services PPI rose at the slowest pace since the recovery began…
Final demand broken down by components:
Via The BLS,
The index for final demand services moved down 0.3 percent in February, the largest decrease since a 0.4-percent decline in May 2013. Most of the February drop can be traced to margins for final demand trade services, which fell 1.0 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.)
Prices for final demand transportation and warehousing services declined 0.2 percent. Conversely, the index for final demand services less trade, transportation, and warehousing inched up 0.1 percent in February.
And the explanation:
