US Producer Price Index Falls 0.2% in November

U.S. producer prices fell in November and were muted even outside of energy, a sign of weak inflationary pressure that could point to persistent slack in the economy.

The Labor Department said on Friday its producer price index for final demand dropped 0.2 percent, a sharper fall than expected.

A plunge in gasoline prices drove the decline.

But a core measure of producer inflation, which excludes food, energy and trade services, was flat. That could be worrisome for Federal Reserve policymakers who are expected to debate next week whether to keep a pledge that borrowing costs will stay at rock bottom for a “considerable time.”

When compared to a year earlier, that core index was up just 1.5 percent, and the annual reading has been dropping a tenth of a point each month since September.

Another core reading that only strips out food and energy was also flat on the month and up 1.8 percent from November 2013.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza