Stripping back Retail Sales numbers to exclude autos and energy prices – which can fluctuate considerably month to month – we see 0.4 percent, about in-line with expectations. It is the highest level since 78-point-34 in October.
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WASHINGTON-A gauge of US business prices was pushed up in May by rising energy costs-a sign that the damping effect of cheap oil on overall inflation is fading. Excluding the volatile food and fuel categories, import prices also rose 0.4% from April and are still down 1.7% from May 2015.
Dubai crude oil prices rose 13-point-five percent from 38-point-99 dollars per barrel in April to 44-point-26 dollars per barrel last month.
Economists polled by Reuters had forecast import prices rising 0.7% in May after April’s previously reported 0.3% gain.
The Labor Department says its producer price index, which measures inflation pressures before they reach the consumer, increased 0.4 per cent in May after a 0.2 per cent rise in April. There is likely to be some easing of underlying concerns that inflation will stay too low with the Federal Reserve more confident in its inflation outlook, which would also lower the barrier to higher interest rates. In contrast, prices for final demand services excluding trade, transportation and warehousing fell 0.2 percent. The increase reflected an increase in margins received by wholesalers and retailers. Import prices for petroleum and petroleum products advanced 17.4% in May, an acceleration from April’s 11.0% rise.
The so-called core PPI was up 0.8 per cent in the 12 months through May. As measured by the Fed’s preferred gauge, the price index for personal consumption expenditures, inflation has undershot 2% for four years.
The latest figures show import prices for nonfuel industrial supplies and materials, such as metals and building materials, rose 1.7% in May, after rising 0.4% in April.
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Brazil’s benchmark equity index fell 0.5 percent to 49,186.07 at 10:43 a.m.in Sao Paulo as all but 10 of its 59 stocks dropped. The central bank has been reluctant to raise rates in small part because of low inflation.
