— Michael Shaoul, Marketfield Asset Management
The seasonally adjusted Producer Price Index for final demand rose more than expected in April, official data showed on Thursday. According to the Bureau of Labour Statistics, US producer prices rose 0.5% for the month of April, following the preceding month's 0.1% decline and surpassing analysts' expectations for a 0.2% hike. On a yearly basis, the Producer Price Index posted a gain of 2.5% in the reported month, the strongest increase since February 2012, compared to 2.3% registered in March. A 0.4% advance in prices for final demand services caused over 60% of the rise in the final demand PPI. That climb was mainly driven by higher costs of investment advice, dealing, securities brokerage and related services. Furthermore, the report showed prices for goods and food rose 0.5% and 0.9% respectively, while energy prices climbed 0.8%, supported by a 3.9% jump in the gasoline cost. In the meantime, the so-called core PPI, which excludes volatile items, showed a monthly advance of 0.4% and a 1.9% gain year-over-year with both readings going beyond economists' forecasts.
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