–YOY PPI +6.0%, YOY Core PPI +0.9%; Claims Little Chgd from Mid-March
By Joseph Plocek
WASHINGTON (MNI) – The U.S. March PPI seems like ‘old news’ after
the CPI was released last week, and the unemployment claims data are
suggesting economic stabilization.
Initial unemployment claims fell 24,000 to 456,000 for the April 17
week, the payroll survey period. This compares to 454,000 in mid-March
and suggests little change in labor market conditions after a
holiday-related spike earlier.
There was nothing unusual in the data, a Labor Department economist
said.
Initial claims are off the 650,000 peak of a year ago, and thus are
improving.
Continuing claims declined 40,000 to 4.646 million for the April 10
week, also downtrending since a June 2009 peak and indicating some
improvement, but probably not enough to show large gains in payrolls.
In a separate report, U.S. March PPI printed +0.7% and +0.1% in
core (unrounded +0.0579%). These represent over-the-year rates of +6.0%
overall and +0.9% core.
PPI is less important since we already know CPI was modest from a
report last week.
Overall PPI seesawed from -0.6% in February, and mainly reflected
+2.4% in foods (where vegetables surged 49.3% on big gains in tomatoes,
dry onions, cauliflower, green peppers and lettuce) and +0.7% in energy
(where large gains were widespread except for -8.4% in Liquified
Petroleum Gas). This was the largest gain in PPI food prices since
January 1984.
In core, jewelry printed +4.9%, representing 85% of the core gain,
and cigarettes printed +1.0%. These were offset by -1.1% in passenger
cars.
The bottom line is that rising core was in a few luxury items and
might be absorbed in margins rather than passed into CPI in coming
months.
There were a few signs of rising prices in the pipeline:
Intermediate PPI posted +0.6% and Crude posted +3.2%. Prices of metals,
wastepaper and chemicals rose in these areas.
**Market News International Washington Bureau: (202) 371-2121**
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