U.S. Producer Price Index (PPI) for final demand decreased 0.1% in February, seasonally adjusted. Final demand prices advanced 0.3% in January and declined 0.2% in December 2022. On an unadjusted basis, the final demand index rose 4.6% for the 12 months ended in February, as the U.S. Bureau of Labor Statistics reported.
In February, the decline in the final demand index was led by prices for final demand goods, which fell 0.2%. The index for final demand services edged down 0.1%.
The index for final demand less foods, energy, and trade services increased 0.2% in February after rising 0.5% in January. For the 12 months ended in February, prices for final demand less foods, energy, and trade services advanced 4.4%.
Final demand goods: The index for final demand goods fell 0.2% in February following a 1.2% advance in January. A 2.2% decline in prices for final demand foods was a major factor in the February decrease. The index for final demand energy moved down 0.2%. In contrast, prices for final demand goods less foods and energy rose 0.3%.
Product detail: Over 80% of the February decline in the index for final demand goods can be attributed to a 36.1% drop in prices for chicken eggs. The indexes for residential natural gas, fresh and dry vegetables, diesel fuel, home heating oil, and primary basic organic chemicals also fell. Conversely, prices for iron and steel scrap advanced 10.6%. The indexes for gasoline and for sugar and confectionery products also increased.
Final demand services: The index for final demand services inched down 0.1% in February, the same as in January. Leading the February decline, margins for final demand trade services fell 0.8%. (Trade indexes measure changes in margins received by wholesalers and retailers.) Prices for final demand transportation and warehousing services decreased 1.1%. In contrast, the index for final demand services less trade, transportation, and warehousing advanced 0.3%.
Product detail: A major factor in the February decrease in prices for final demand services was margins for machinery and vehicle wholesaling, which fell 3.9%. The indexes for chemicals and allied products wholesaling, automobiles and automobile parts retailing, guestroom rental, and airline passenger services also declined. Conversely, prices for outpatient care (partial) rose 0.5%. The indexes for food and alcohol retailing; securities brokerage, dealing, investment advice, and related services; and loan services (partial) also increased.
