13 September 2013 14:42 [Source: ICIS news]
WASHINGTON (ICIS)--US producer prices rose by 0.3% in August from July, the Labor Department said on Friday, with the increase driven by higher wholesale-level costs for gasoline and foods but with help from gains in chemicals and resins.
In its monthly report on producer prices, also known as wholesale prices, the department said that last month’s advance was attributed almost wholly to a 0.8% advance in energy product prices, including a sharp 2.6% boost in gasoline wholesale costs.
The 0.8% increase in producer prices for energy products in August more than offset the 0.2% decline seen in July.
While the gain in gasoline and other energy product prices accounted for two-thirds of the overall August increase, wholesale prices for foods also contributed, climbing by 0.6% last month following a flat measure for July.
Within the foods category, much of the 0.6% advance was attributed to an almost 27% surge in wholesale prices for vegetables, the department said.
Without the more volatile prices for energy and food products counted in the overall total, the department said that the so-called core index for producer prices was unchanged in August from July.
Part of the growth in overall wholesale prices for August was attributed to a 0.3% increase in producer prices for basic organic chemicals and an equal 0.3% rise in prices of plastic resins.
The gain in organic chemicals wholesale prices followed a 1.6% decline in July.
Resins too saw a pricing downturn in July, but at a much shallower 0.2% decline.
Economists watch wholesale prices for early warnings of inflation gains at the retail level.
Any harbinger of sharp increases in consumer-level inflation could trigger restraining action by the Federal Reserve Board in the form of raising interest rates.
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy
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