November 2022 Consumer and Producer Price Indices (incl. Forest Products)

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Consumer Price Index

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1% in November (+0.3% expected) after increasing 0.4% in October. Over the last 12 months, the all-items index increased 7.1% before seasonal adjustment.

The index for shelter was by far the largest contributor to the monthly all-items increase, more than offsetting decreases in energy indexes. The food index increased 0.5% over the month with the food at home index also rising 0.5%. The energy index decreased 1.6% over the month as the gasoline index, the natural gas index, and the electricity index all declined.

The index for all items less food and energy rose 0.2% in November, after rising 0.3% in October. The indexes for shelter, communication, recreation, motor vehicle insurance, education, and apparel were among those that increased over the month. Indexes which declined in November include the used cars and trucks, medical care, and airline fares indexes.

The all-items index increased 7.1% for the 12 months ending November; this was the smallest 12-month increase since the period ending December 2021. The index for all items less food and energy rose 6.0% over the last 12 months. The energy index increased 13.1% for the 12 months ending November, and the food index increased 10.6% over the last year; all of these increases were smaller than for the period ending October.

Producer Price Index

The Producer Price Index for final demand (PPI-FD) advanced 0.3% in November (+0.2% expected). Final demand prices also rose 0.3% in both October and September. On an unadjusted basis, the index for final demand moved up 7.4% for the 12 months ended in November.

In November, most of the increase in the index for final demand is attributable to a 0.4% advance in prices for final demand services. The index for final demand goods inched up 0.1%.

Prices for final demand less foods, energy, and trade services moved up 0.3% in November after rising 0.2% in October. For the 12 months ended in November, the index for final demand less foods, energy, and trade services increased 4.9%.

Final Demand

Final demand services: The index for final demand services advanced 0.4% in November after edging up 0.1% in October. Leading the November increase, prices for final demand services less trade, transportation, and warehousing climbed 0.4%. Margins for final demand trade services rose 0.7%. (Trade indexes measure changes in margins received by wholesalers and retailers.) In contrast, prices for final demand transportation and warehousing services declined 0.9%.

Product detail: About one-third of the November rise in the index for final demand services can be traced to prices for securities brokerage, dealing, investment advice, and related services, which jumped 11.3%. The indexes for machinery and vehicle wholesaling, loan services (partial), fuels and lubricants retailing, portfolio management, and long-distance motor carrying also moved higher. Conversely, prices for transportation of passengers (partial) fell 5.6%. The indexes for automobile and automobile parts retailing and for traveler accommodation services also decreased.

Final demand goods: The index for final demand goods inched up 0.1% in November following a 0.6% rise in October. A 3.3% increase in prices for final demand foods was a major factor in the November advance. The index for final demand goods less foods and energy moved up 0.3%. In contrast, prices for final demand energy decreased 3.3%.

Product detail: The November advance in prices for final demand goods was led by a 38.1% jump in the index for fresh and dry vegetables. Prices for chicken eggs; meats; canned, cooked, smoked, or prepared poultry; and tobacco products also moved higher. Conversely, the gasoline index fell 6.0%. Prices for diesel fuel, residential natural gas, and primary basic organic chemicals also declined.

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All not-seasonally adjusted price indexes we track were mixed on both a MoM and YoY basis.

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The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purposes of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.