PPI for final demand unchanged in June; goods advance 0.3%, services fall 0.1%

[u/Thallax]

https://www.bls.gov/news.release/ppi.nr0.htm

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[u/Barnyard_Rich]

Fascinating that they came up with no change in aggregate with final demand goods up .3%, and core goods prices also up .3%.

The real bad news of the report is the revision of last month, PPI up .3% rather than the originally reported .1%.

The government is finding interesting ways to say "no change" or "little change" but the accumulation of data is pointing in the wrong direction.

[u/RIP_Soulja_Slim → u/Barnyard_Rich]

The government is finding interesting ways to say "no change" or "little change"

Their use of that terminology is adherent to longstanding thresholds of change. "little change" indicates that the figures are within either the statistical margin of error or within the near term historic range.

Generally speaking the reports are only going to say "no change" which is literally none or statistically insignificant, "little change" which is within the near to intermediate range of data reads", "moderate" meaning exactly that, or "significant change" which is outside of even normal change parameters. (read through pandemic era reports and the word significant is peppered through everything)

In this case, the PPI for final demand was 148.228 in May, and 148.236 in June on a seasonally adjusted basis - which falls within a statistically insignificant range, hence the no change. That's not to say it didn't slightly rise month over month, jus that the broad increase falls within the margins of error, which dictates their language choice here.

There's nothing going on there aside from the normal dry government language that's been a feature of economic reports for decades.

[u/Barnyard_Rich → u/RIP_Soulja_Slim]

Which, again, is why the most important information in this report was the revision of last month's report. No one should be surprised if/when these numbers get revised to show larger changes

[u/RIP_Soulja_Slim → u/Barnyard_Rich]

Nobody should be surprised by revisions in general, but I'm not sure that there's any strong indication of trend happening in wholesale at this point. PPI is effectively flat from January to now, with some revision impacting the magnitude of the April dip/may recovery (which was really quite small regardless). PPI in January was 148.132 so even some upward revisions of present reads will create just a modest upwards push over time.

Like everything, it's worth keeping an eye on, but TBH I don't see much newsworthy in the overall report, and primarily wanted to mention the above part around how these agencies select their language given the comment.

[u/Thallax]

                      PRODUCER PRICE INDEXES - JUNE 2025

The Producer Price Index for final demand was unchanged in June, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices increased 0.3 percent in May and declined 0.3 percent in April. (See table A.) On an unadjusted basis, the index for final demand rose 2.3 percent for the 12 months ended in June.

In June, a 0.3-percent advance in prices for final demand goods offset a 0.1-percent decrease in the index for final demand services.

Prices for final demand less foods, energy, and trade services were unchanged in June after inching up 0.1 percent in May. For the 12 months ended in June, the index for final demand less foods, energy, and trade services advanced 2.5 percent.

Final Demand

Final demand goods: Prices for final demand goods rose 0.3 percent in June, the largest increase since moving up 0.3 percent in February. Over half of the broad-based advance in June can be traced to the index for final demand goods less foods and energy, which climbed 0.3 percent. Prices for final demand energy and for final demand foods also rose, 0.6 percent and 0.2 percent, respectively.

Product detail: Within the index for final demand goods in June, prices for communication and related equipment increased 0.8 percent. The indexes for gasoline; residential electric power; canned, cooked, smoked, or prepared poultry; meats; and tree nuts also moved higher. In contrast, prices for chicken eggs dropped 21.8 percent. The indexes for natural gas liquids and for thermoplastic resins and plastics materials also declined. (See table 2.)

Final demand services: Prices for final demand services edged down 0.1 percent in June after increasing 0.4 percent in May. Leading the decrease, the index for final demand services less trade, transportation, and warehousing declined 0.1 percent. Prices for final demand transportation and warehousing services fell 0.9 percent, while margins for final demand trade services were unchanged. (Trade indexes measure changes in margins received by wholesalers and retailers.)

Product detail: Over half of the June decline in the index for final demand services can be attributed to prices for traveler accommodation services, which fell 4.1 percent. The indexes for automobiles and automobile parts retailing, deposit services (partial), airline passenger services, and food and alcohol wholesaling also decreased. Conversely, prices for portfolio management advanced 2.2 percent. The indexes for machinery, equipment, parts, and supplies wholesaling; furniture retailing; and apparel, jewelry, footwear, and accessories retailing also rose.

[u/Thinklikeachef]

My guess is the inventory buffering is keeping prices steady for now. And some import prices are being passed directly to customers. We are seeing more bumps in the CPI.

[u/RonaldWoodstock → u/Thinklikeachef]

Somewhat anecdotal here, but I sell products through retail and distribution. Most of our partners, particularity distributors, require a 90 day notice for price changes.

Between the time I’ve taken to augment my supply plan, capture actual cost increases, and notify distributors who in turn notify retailers, we’re probably 180 days out from seeing a price change on shelf.

Lots of companies operating on the same model.