The Labor
Department announced on Friday that the U.S. producer-price index (PPI) declined
0.4 per cent m-o-m in March,
following an upwardly revised 0.1 per cent m-o-m uptick (from flat m-o-m) in February. This marked the
first monthly drop in PPI since October 2023 (-0.4 per
cent m-o-m).
For the 12
months through March, the PPI surged by 2.7 per cent, sharply decelerating from an unrevised 3.2
per cent climb in the
previous month. This represented the weakest
annual gain since September 2024
(+2.1 per cent).
Economists had expected
the headline PPI would increase 0.2 per cent m-o-m and 3.3 per cent over the
past 12 months.
According to
the report, over 70 per cent of the March decrease in the headline index can be
attributed to a 0.9 per cent m-o-m drop in the index for final demand goods. In
addition, the index for final demand services slipped 0.2 per cent m-o-m.
Excluding
volatile prices for food and energy, the PPI edged down 0.1 per cent m-o-m, registering
its first monthly fall since July 2024
(-0.1 per cent m-o-m), and soared 3.3 per cent over 12 months, recording its softest
annual since August 2024
(+2.8 per cent y-o-y). Economists had predicted advances of 0.3 per cent m-o-m
and 3.6 per cent y-o-y in March. In February, the core PPI posted a 0.1 per
cent m-o-m uptick
(revised from -0.1 per cent m-o-m in the initial estimate) and a 3.5 per cent y-o-y climb (revised
from +3.4 per cent y-o-y in the initial estimate).