From the Bureau of Labor Statistics, January 13:
PRODUCER PRICE INDEXES - DECEMBER 2021
The Producer Price Index for final demand increased 0.2 percent in December, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This rise followed advances of 1.0 percent in November and 0.6 percent in October. (See table A.) On an unadjusted basis, final demand prices moved up 9.7 percent in 2021, the largest calendar-year increase since data were first calculated in 2010.
In December, the advance in the final demand index can be traced to a 0.5-percent increase in prices for final demand services. Conversely, the index for final demand goods decreased 0.4 percent.
Prices for final demand less foods, energy, and trade services rose 0.4 percent in December following a 0.8-percent increase in November. In 2021, the index for final demand less foods, energy, and trade services moved up 6.9 percent, following a 1.3-percent advance in 2020.
Final Demand
Final demand services: Prices for final demand services rose 0.5 percent in December following a 0.9-percent increase in November. Over half of the broad-based advance in December is attributable to margins for final demand trade services, which moved up 0.8 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.) Prices for final demand services less trade, transportation, and warehousing and for final demand transportation and warehousing services rose 0.2 percent and 1.7 percent, respectively.
Product detail: Over a quarter of the December increase in the index for final demand services can be attributed to margins for fuels and lubricants retailing, which rose 13.0 percent. The indexes for airline passenger services, food retailing, machinery and vehicle wholesaling, machinery and equipment parts and supplies wholesaling, and traveler accommodation services also moved higher. In contrast, margins for automobile and automobile parts retailing decreased 2.7 percent. The indexes for deposit services (partial) and for health, beauty, and optical goods retailing also declined. (See table 2.)
Final demand goods: The index for final demand goods moved down 0.4 percent in December, the first decrease since falling 2.8 percent in April 2020. Leading the December decline, prices for final demand energy dropped 3.3 percent. The index for final demand foods fell 0.6 percent. Conversely, prices for final demand goods less foods and energy advanced 0.5 percent.
Product detail: A major factor in the December decrease in prices for final demand goods was the index for gasoline, which moved down 6.1 percent. Prices for meats, gas fuels, fresh and dry vegetables, diesel fuel, and primary basic organic chemicals also declined. In contrast, the index for ethanol increased 6.4 percent. Prices for residential electric power and for chicken eggs also moved higher.....
....MUCH MORE
We had been hearing the narrative that inflation was because people were buying too much "stuff" but if today's numbers are the start of a trend we have an entirely different beastie to deal with.
More to come.
