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Producer price index September 2024:

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Wholesale prices flat in September, below expectations

A measure of wholesale prices showed no change in September, pointing to a continued easing in inflation, the Labor Department reported Friday.

The producer price index, which measures what producers get for their goods and services, was flat for the month and up 1.8% from a year ago. Economists surveyed by Dow Jones had been looking for a monthly gain of 0.1% after August’s increase of 0.2%.

Excluding food and energy, the PPI rose 0.2%, meeting expectations.

The report comes a day after the Labor Department reported that the consumer price index, a more widely followed inflation measure that shows what consumers actually pay for goods and services, had an increase of 0.2% for the month and 2.4% from a year ago.

Markets showed little reaction to the data, with stock market futures pointing slightly higher on Wall Street while Treasury yields rose on longer-duration securities.

Together, the releases indicate that inflation is off its blistering pace that peaked more than two years ago but still mostly holds above the Federal Reserve’s 2% target.

Within the PPI, a 0.2% decline in final demand goods prices offset a 0.2% increase in services. Excluding trade services from core PPI, the index increased 0.1%.

A 3% jump in deposit services costs pushed the services index higher, while professional and commercial equipment wholesaling prices tumbled 6.3%.

On the goods side, a 2.7% slide in final demand in energy was the main factor in the decrease. Similarly, the index for gasoline fell 5.6%, holding back gains on the goods index. Diesel fuel prices plunged 17.6%.

Fed officials in recent days have expressed confidence that inflation is heading back to target even though some aspects, such as shelter, food and vehicle costs, have held stubbornly higher. Minutes from the September central bank meeting indicated policymakers were divided over the decision to slash the Fed’s benchmark interest rate by half a percentage point.

Most officials say they expect to continue to cut as long as the data indicates. Markets anticipate the Fed to lower by a quarter percentage point at each of its two remaining meetings this year.

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