Producer Price Index News Release text

Transmission of material in this release is embargoed until                          USDL 16-1827 
8:30 a.m. (EDT), Thursday, September 15, 2016

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                                 PRODUCER PRICE INDEXES - AUGUST 2016


The Producer Price Index for final demand was unchanged in August, seasonally adjusted, the 
U.S. Bureau of Labor Statistics reported today. Final demand prices declined 0.4 percent in July 
and rose 0.5 percent in June. On an unadjusted basis, the final demand index was unchanged for 
the 12 months ended in August. (See table A.)

In August, a 0.1-percent advance in the index for final demand services offset a 0.4-percent 
decrease in prices for final demand goods.

Prices for final demand less foods, energy, and trade services increased 0.3 percent in August 
after no change in July. For the 12 months ended in August, the index for final demand less 
foods, energy, and trade services moved up 1.2 percent, the largest rise since climbing 1.3 
percent for the 12 months ended December 2014.

Final Demand

Final demand services: The index for final demand services edged up 0.1 percent in August 
following a 0.3-percent decline in July. The advance can be traced to prices for final demand services 
less trade, transportation, and warehousing, which increased 0.5 percent. In contrast, the index for 
final demand trade services fell 0.6 percent. (Trade indexes measure changes in margins received by 
wholesalers and retailers.) Prices for final demand transportation and warehousing services moved 
down 0.4 percent. 

Product detail: Within the index for final demand services in August, prices for outpatient care 
(partial) advanced 0.5 percent. The indexes for apparel, jewelry, footwear, and accessories retailing; 
guestroom rental; portfolio management; and residential real estate services (partial) also moved 
higher. Conversely, margins for machinery and equipment wholesaling decreased 2.9 percent. The 
indexes for chemicals and allied products wholesaling, services related to securities brokerage and 
dealing, and airline passenger services also declined. (See table 4.)

Final demand goods: The index for final demand goods fell 0.4 percent in August, the same as in 
July. Eighty percent of the August decrease can be traced to a 1.6-percent drop in prices for final 
demand foods. Also contributing to the decline in the index for final demand goods, prices for final 
demand energy moved down 0.8 percent. In contrast, the index for final demand goods less foods and 
energy inched up 0.1 percent.

Product detail: Thirty percent of the August decrease in the index for final demand goods is 
attributable to a 3.6-percent drop in prices for meats. The indexes for gasoline, fresh and dry 
vegetables, jet fuel, chicken eggs, and diesel fuel also fell. Conversely, prices for pharmaceutical 
preparations increased 1.0 percent. The indexes for electric power and natural, processed, and 
imitation cheese also rose. 

Table A. Monthly and 12-month percent changes in selected final demand price indexes, seasonally adjusted
Month Total
final
demand
Final
demand
less
foods,
energy,
and
trade
Final demand goods Final demand services Change
in final
demand
from 12
months
ago
(unadj.)
Change
in final
demand
less
foods,
energy,
and
trade
from 12
mo. ago
(unadj.)
Total Foods Energy Less
foods
and
energy
Total Trade Transportation
and
warehousing
Other

2015

Aug.

-0.2 0.0 -0.5 0.2 -2.6 -0.2 -0.1 -0.4 -0.9 0.2 -1.0 0.6

Sept.

-0.5 -0.1 -1.0 -0.3 -5.3 0.0 -0.1 0.2 0.0 -0.2 -1.1 0.5

Oct.

-0.2 -0.2 -0.3 -0.7 -0.2 -0.3 -0.2 -0.2 -0.1 -0.1 -1.4 0.4

Nov.

0.1 0.1 -0.1 -0.3 0.1 -0.1 0.1 0.1 0.1 0.1 -1.3 0.2

Dec.

-0.1 0.1 -0.6 -0.9 -3.5 0.1 0.3 0.4 -0.8 0.2 -1.1 0.3

2016

Jan.

0.4 0.3 -0.5 0.9 -4.3 0.1 0.9 1.7 0.5 0.6 0.0 0.8

Feb.

-0.3 0.1 -0.7 0.1 -4.9 0.0 -0.1 -0.5 -0.3 0.1 0.1 0.9

Mar.

-0.2 0.1 0.0 -1.4 1.1 0.2 -0.3 -0.7 -0.3 0.1 -0.1 0.9

Apr.(1)

0.3 0.2 0.4 -0.5 1.8 0.3 0.2 0.3 -0.3 0.2 0.2 1.0

May(1)

0.3 -0.1 0.8 0.5 3.0 0.3 0.0 0.6 -1.1 -0.2 -0.1 0.8

June

0.5 0.3 0.8 0.9 4.1 0.0 0.4 0.7 0.5 0.4 0.3 0.9

July

-0.4 0.0 -0.4 -1.1 -1.0 0.0 -0.3 -1.3 0.1 0.2 -0.2 0.8

Aug.

0.0 0.3 -0.4 -1.6 -0.8 0.1 0.1 -0.6 -0.4 0.5 0.0 1.2

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2016 have been revised to reflect the availability of late reports and corrections by respondents.

Intermediate Demand by Commodity Type

Within intermediate demand in August, prices for processed goods inched down 0.1 percent, the 
index for unprocessed goods fell 2.8 percent, and prices for services were unchanged. (See tables B 
and C.)

Processed goods for intermediate demand: The index for processed goods for intermediate 
demand edged down 0.1 percent in August following four straight increases. Leading the decrease, 
prices for processed energy goods fell 1.1 percent. The index for processed foods and feeds declined 
1.9 percent. In contrast, prices for processed materials less foods and energy advanced 0.3 percent. 
For the 12 months ended in August, the index for processed goods for intermediate demand fell 3.1 
percent.

Product detail: Leading the August decline in the index for processed goods for intermediate 
demand, prices for diesel fuel decreased 6.1 percent. The indexes for prepared animal feeds, jet fuel, 
meats, and semifinished steel mill products also moved lower. Conversely, prices for primary basic 
organic chemicals advanced 8.5 percent. The indexes for electric power; cold rolled steel sheet and 
strip; and natural, processed, and imitation cheese also increased. (See table 5.)

Unprocessed goods for intermediate demand: The index for unprocessed goods for intermediate 
demand moved down 2.8 percent in August, the largest decline since falling 3.9 percent in December 
2015. Nearly 80 percent of the August decrease can be traced to a 6.8-percent drop in the index for 
unprocessed energy materials. Prices for unprocessed foodstuffs and feedstuffs moved down 1.8 
percent. In contrast, the index for unprocessed nonfood materials less energy advanced 0.8 percent. 
For the 12 months ended in August, the index for unprocessed goods for intermediate demand fell 
8.4 percent.

Product detail: Nearly half of the August decline in prices for unprocessed goods for intermediate 
demand is attributable to the index for crude petroleum, which fell 9.1 percent. Prices for natural gas, 
slaughter poultry, slaughter barrows and gilts, coal, and carbon steel scrap also moved lower.  
Conversely, the index for nonferrous metal ores advanced 4.1 percent. Prices for raw milk and corn 
also moved higher.

Table B. Monthly and 12-month percent changes in selected intermediate demand price indexes for goods by commodity type, seasonally adjusted
Month Processed goods for intermediate demand Unprocessed goods for intermediate demand
Total Foods
and
feeds
Energy
goods
Less
foods
and
energy
Total,
change
from 12
months
ago
(unadj.)
Total Foodstuffs
and
feedstuffs
Energy
materials
Nonfood
materials
less
energy
Total,
change
from 12
months
ago
(unadj.)

2015

Aug.

-0.8 -0.5 -2.2 -0.5 -7.2 -3.5 0.8 -8.4 -3.9 -23.7

Sept.

-1.3 -1.8 -4.3 -0.5 -8.3 -2.2 -4.3 -1.0 -0.2 -25.7

Oct.

-0.4 -0.7 -1.0 -0.3 -7.7 -1.3 -1.4 -0.4 -2.3 -24.0

Nov.

-0.5 -0.9 -1.1 -0.2 -7.2 -4.3 -2.3 -7.6 -3.7 -26.4

Dec.

-1.1 -2.0 -4.0 -0.4 -6.6 -3.9 -3.0 -7.2 -0.9 -25.3

2016

Jan.

-0.9 -0.7 -3.4 -0.4 -5.3 0.2 4.8 -6.0 -0.5 -17.5

Feb.

-0.9 0.6 -4.8 -0.3 -5.8 -1.9 -1.0 -5.7 0.6 -16.4

Mar.

0.0 -0.6 0.5 0.0 -5.5 1.6 -0.8 3.9 2.5 -14.4

Apr.(1)

0.3 -0.4 1.0 0.3 -4.6 2.2 -2.1 8.3 3.5 -13.0

May(1)

0.8 1.1 3.0 0.3 -4.6 2.1 -0.7 4.9 3.8 -13.7

June

0.9 1.7 4.0 0.2 -4.1 2.8 0.4 8.5 -0.3 -11.4

July

0.2 0.0 0.8 0.1 -3.7 -0.4 -3.6 5.0 -0.8 -8.7

Aug.

-0.1 -1.9 -1.1 0.3 -3.1 -2.8 -1.8 -6.8 0.8 -8.4

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2016 have been revised to reflect the availability of late reports and corrections by respondents.

Services for intermediate demand: The index for services for intermediate demand was unchanged 
in August following two consecutive increases. In August, prices for services less trade, 
transportation, and warehousing for intermediate demand rose 0.4 percent and the index for 
transportation and warehousing services for intermediate demand edged up 0.1 percent. In contrast, 
margins for trade services for intermediate demand declined 1.3 percent. For the 12 months ended in 
August, the index for services for intermediate demand increased 1.4 percent. 

Product detail: In August, prices for portfolio management climbed 2.8 percent. The indexes for loan 
services (partial); broadcast and network television advertising time sales; courier, messenger, and 
U.S. postal services; and machinery and equipment parts and supplies wholesaling also advanced. 
Conversely, margins for chemicals and allied products wholesaling fell 5.2 percent. The indexes for 
services related to securities brokerage and dealing; metals, minerals, and ores wholesaling; food 
wholesaling; and airline passenger services also declined.

Table C. Monthly and 12-month percent changes in selected intermediate demand price indexes for services by commodity type, seasonally adjusted
Month Services for intermediate demand
Total Trade Transportation
and
warehousing
Other Total, change
from 12 months
ago (unadj.)

2015

Aug.

0.2 -0.8 -0.3 0.6 1.6

Sept.

-0.5 -0.1 -0.2 -0.8 1.1

Oct.

-0.5 -0.3 -0.1 -0.6 0.2

Nov.

0.1 -0.4 0.1 0.2 0.4

Dec.

0.2 -1.0 -0.2 0.6 0.5

2016

Jan.

1.3 0.5 -0.5 1.9 1.5

Feb.

0.2 -0.3 0.0 0.3 1.9

Mar.

0.0 -0.1 -0.1 0.1 1.6

Apr.(1)

0.0 -0.1 -0.5 0.1 1.1

May(1)

-0.4 -0.1 -0.3 -0.5 0.9

June

0.8 1.1 0.4 0.8 1.6

July

0.3 0.4 0.3 0.2 1.6

Aug.

0.0 -1.3 0.1 0.4 1.4

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2016 have been revised to reflect the availability of late reports and corrections by respondents.

Intermediate Demand by Production Flow

Stage 4 intermediate demand: The index for stage 4 intermediate demand was unchanged in 
August, the same as in July. In August, prices for total services inputs to stage 4 intermediate demand 
edged up 0.1 percent. The index for total goods inputs was unchanged. (See table D.) Increases in the 
indexes for portfolio management; loan services (partial); legal services; machinery and equipment 
parts and supplies wholesaling; and natural, processed, and imitation cheese offset declines in the 
indexes for chemicals and allied products wholesaling; diesel fuel; services related to securities 
brokerage and dealing; meats; and metals, minerals, and ores wholesaling. (See table 6.) For the 12 
months ended in August, the index for stage 4 intermediate demand fell 0.3 percent.

Stage 3 intermediate demand: The index for stage 3 intermediate demand declined 0.6 percent in 
August, the first decrease since falling 0.8 percent in February. In August, prices for total goods 
inputs to stage 3 intermediate demand moved down 0.7 percent and the index for total services inputs 
declined 0.3 percent. Decreases in the indexes for slaughter poultry, jet fuel, slaughter barrows and 
gilts, gasoline, chemicals and allied products wholesaling, and services related to securities brokerage 
and dealing outweighed increases in prices for raw milk, primary basic organic chemicals, and loan 
services (partial). For the 12 months ended in August, the index for stage 3 intermediate demand 
decreased 3.9 percent.

Stage 2 intermediate demand: The index for stage 2 intermediate demand declined 0.7 percent in 
August following five consecutive increases. In August, prices for total goods inputs to stage 2 
intermediate demand fell 1.9 percent. In contrast, the index for total services inputs edged up 0.1 
percent. Lower prices for crude petroleum, gas fuels, services related to securities brokerage and 
dealing, prepared animal feeds, thermoplastic resins and materials, and semifinished steel mill 
products outweighed increases in the indexes for portfolio management, legal services, and cold 
rolled steel sheet and strip. For the 12 months ended in August, the index for stage 2 intermediate 
demand inched down 0.1 percent.

Stage 1 intermediate demand: The index for stage 1 intermediate demand declined 0.3 percent in 
August, the first decrease since dropping 0.8 percent in February. In August, prices for total services 
inputs to stage 1 intermediate demand fell 0.4 percent and the index for total goods inputs moved 
down 0.3 percent. Declines in the indexes for chemicals and allied products wholesaling; diesel fuel; 
carbon steel scrap; metals, minerals, and ores wholesaling; services related to securities brokerage 
and dealing; and crude petroleum outweighed increases in prices for primary basic organic 
chemicals, loan services (partial), and wastepaper. For the 12 months ended in August, the stage 1 
intermediate demand index decreased 2.5 percent.

Table D. Monthly percent changes in selected intermediate demand price indexes by production flow, seasonally adjusted
Month Stage 4 intermediate
demand
Stage 3 intermediate
demand
Stage 2 intermediate
demand
Stage 1 intermediate
demand
Total Goods
inputs
Services
inputs
Total Goods
inputs
Services
inputs
Total Goods
inputs
Services
inputs
Total Goods
inputs
Services
inputs

2015

Aug.

-0.2 -0.4 0.2 -0.5 -1.1 0.2 -1.1 -3.0 0.3 -1.1 -1.7 -0.1

Sept.

-0.5 -0.8 -0.5 -1.8 -3.0 -0.4 -0.8 -1.2 -0.6 -1.5 -2.3 -0.6

Oct.

-0.3 -0.2 -0.5 -0.6 -1.0 -0.4 -0.4 -0.2 -0.6 -0.8 -0.9 -0.6

Nov.

-0.1 -0.2 0.2 -0.4 -0.7 0.0 -1.2 -2.9 0.0 -0.8 -1.4 0.0

Dec.

-0.4 -0.8 0.0 -0.9 -2.1 0.2 -0.5 -2.4 0.7 -1.4 -2.2 -0.4

2016

Jan.

0.3 -0.3 1.0 0.1 -0.5 0.9 -0.3 -2.3 1.3 0.1 -1.2 1.5

Feb.

-0.1 -0.4 0.1 -0.8 -2.0 0.3 -0.6 -2.0 0.2 -0.8 -1.4 0.1

Mar.

-0.1 0.0 -0.1 0.1 0.1 0.0 0.4 0.7 0.2 0.4 1.0 -0.3

Apr.(1)

0.1 0.1 0.1 0.0 0.2 -0.1 0.8 2.4 -0.2 0.8 1.3 0.2

May(1)

0.1 0.4 -0.3 0.1 0.3 -0.3 1.0 2.7 -0.1 0.7 1.9 -0.9

June

0.7 0.7 0.8 0.9 1.2 0.7 1.5 2.9 0.6 1.2 1.2 1.2

July

0.0 -0.1 0.1 0.0 -0.3 0.3 0.7 1.1 0.5 0.0 -0.1 0.3

Aug.

0.0 0.0 0.1 -0.6 -0.7 -0.3 -0.7 -1.9 0.1 -0.3 -0.3 -0.4

Footnotes
(1) Some of the figures shown above and elsewhere in this release may differ from those previously reported because data for April 2016 have been revised to reflect the availability of late reports and corrections by respondents.

_____________
The Producer Price Index for September 2016 is scheduled to be released on Friday, 
October 14, 2016 at 8:30 a.m. (EDT).

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Last Modified Date: September 15, 2016