October 2011 Consumer and Producer Price Indices

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The seasonally adjusted Consumer Price Index for All Urban Consumers (CPI-U) decreased 0.1 percent in October. Over the last 12 months, the all items index increased 3.5 percent before seasonal adjustment.

A decline in the energy index more than offset small increases in the indexes for food and all items less food and energy to create the all items decline. The energy index turned down in October after increasing in each of the three previous months as the gasoline and household energy indexes declined after a series of seasonally adjusted increases. The food index rose in October, but posted its smallest increase of the year as the fruits and vegetables index declined sharply.

The index for all items less food and energy increased 0.1 percent in October; this was the same increase as last month and matches its smallest increase of the year. While the shelter and medical care indexes accelerated in October and the apparel index turned up, the indexes for new vehicles, used cars and trucks, airline fare, and recreation all declined.

The all items index has risen 3.5 percent over the last 12 months, a lower figure than last month's 3.9 percent increase, as the 12-month change in the energy index fell from 19.3 to 14.2 percent. In contrast, the 12-month change for all items less food and energy edged up from 2.0 to 2.1 percent. The food index 12-month change was 4.7 percent, the same figure as in September.

The seasonally adjusted Producer Price Index for Finished Goods (PPI) declined 0.3 percent in October. Finished goods prices rose 0.8 percent in September and were unchanged in August. At the earlier stages of processing, the index for intermediate goods moved down 1.1 percent in October and crude goods prices fell 2.5 percent. On a seasonally unadjusted basis, the finished goods index increased 5.9 percent for the 12 months ended October 2011, the smallest year-over-year advance since a 5.6-percent rise in March 2011.
 

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Details at different stages of processing include:

Finished goods -- In October, the decrease in finished goods prices was the result of a 1.4 percent drop in the index for finished energy goods. By contrast, prices for finished consumer foods inched up 0.1 percent. The index for finished goods less foods and energy was unchanged.

Intermediate goods -- This index fell 1.1 percent, the largest decline since a 1.5-percent drop in March 2009. Over half of the broad-based October decrease can be traced to prices for intermediate energy goods, which fell 2.6 percent. The indexes for intermediate goods less foods and energy and for intermediate foods and feeds also contributed to the decline in intermediate goods prices, falling 0.6 percent and 1.5 percent, respectively. For the 12 months ending October 2011, the intermediate goods index advanced 8.3 percent, the smallest year-over-year rise since an 8.1-percent increase in February 2011.

Crude goods -- The index for crude goods fell 2.5 percent in October. For the 3 months ending in October, prices for crude materials advanced 0.4 percent following a 5.9-percent decrease from April to July. In October, nearly forty percent of the broad-based monthly decline can be traced to a 4.3-percent drop in the index for crude nonfood materials less energy. Lower prices for crude energy materials and for crude foodstuffs and feedstuffs -- down 2.2 percent and 1.8 percent, respectively -- also contributed to the October decrease in the crude goods index.
 

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Half of the price indices for the forest products that we track rose relative to September, while the other half declined. All were higher in October than a year earlier; however, two rose more quickly on a year-over-year basis than in September, three more slowly and one was essentially unchanged.
 

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