The Bureau of Labor Statistics reported on February 14 that January final-demand producer prices rose 0.6 percent after seasonal adjustment. The twelve-month increase was 1.6 percent before adjustment. These figures concern prices received by domestic producers, not a consumer shopping basket. The annual figure is a separate comparison, not the monthly rate projected forward. [ppi_02142017]

Within that domestic measure, final-demand goods prices rose 1.0 percent in January and accounted for over 60 percent of the overall monthly increase. Services rose 0.3 percent. Trade-service margin changes supplied over 80 percent of the services advance. BLS measures margins received by wholesalers and retailers in those trade indexes, rather than the full sales prices of the goods they distribute. Margin changes also do not measure net profit. [ppi_02142017]

The February 10 release follows a different object: import and export prices. U.S. import prices rose 0.4 percent in January; export prices rose 0.1 percent. Both changes are monthly and unadjusted for seasonality. Within imports, fuel rose 5.8 percent while nonfuel prices fell 0.2 percent, so the overall increase contains opposing movements rather than a common rate for every product. [ximpim_02102017]

To read the releases together, label each number with its object before comparing it: domestic output price, distribution margin or cross-border price. Then record the period and adjustment basis. This produces a usable map of the statistics without adding unlike measures together. The two reports come from the same agency and offer complementary coverage, not independent confirmation of a single inflation reading. [ppi_02142017][ximpim_02102017]

Source documents

  1. Producer Price Indexes – January 2017https://www.bls.gov/news.release/archives/ppi_02142017.htm
  2. U.S. Import and Export Price Indexes – January 2017https://www.bls.gov/news.release/archives/ximpim_02102017.htm