The Producer Price Index for finished goods rose 0.2 percent in July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This advance followed a 0.4-percent decrease in June and a 0.2-percent rise in May. At the earlier stages of processing, prices received by manufacturers of intermediate goods moved up 0.2 percent in July, and the crude goods index declined 1.2 percent. On an unadjusted basis, prices for finished goods moved up 7.2 percent for the 12 months ended July 2011. (See table A.)
Well gee, that sounds “sorta” ok, except for one problem – it’s really not, because core was up 0.4 and the 12-month trend in finished goods remains stubbornly pegged around 7%!
Oh yeah, contributing to the rise was tobacco (ok, that’s a “sin” product) and pharmaceuticals. Oops – there’s our wonderful anti-competitive drug industry nailing us once again.
Oh, and don’t worry about the 12-month rate of change in intermediate and crude goods – they’re only both rising, running at an 11.6% and 22.6% (!) 12-month rate-of-change rate.
That won’t hit profits…. right?
PS: I flagged this almost exactly a year ago….. the pig is about through the python and preparing to exit the back end at high velocity. Oh, it wasn’t digested very well either. Hope you’re ready.