Producer Prices and Energy | Weekly Statement December 12

The United States announced its Producer Price Index (PPI) statistics, showing an increase of 0.3% over the previous month's result. The last monthly gain was 0.4% in October 2022, making this the second in a row.

Most of the index, the price of finished consumer goods increased by 0.4%, which was a major contributor. Intermediate goods prices fell -0.3%, offsetting this trend somewhat. Overall, service costs remained the same.

Both durables and non-durables contributed to the overall increase in final consumer goods prices: the former increased by 0.6% and the latter by 0.2%. In contrast to the flat price trend shown for consumer meals, an increase of 0.7% was observed in the cost of finished energy products.

Overall producer prices increased by 0.3%, as measured by the PPI. Put another way, this points to the emergence of inflationary forces, which could eventually lead to an increase in retail prices.

Geopolitical tensions are driving high energy costs, while supply-side disruptions are also distorting consumer prices.

The bottom line is that almost half of the world's countries are experiencing double-digit inflation rates or higher.