Watch Wholesale Inflation Posts Unexpected Decline in February | Economy – US Latest News

Spread the love

Watch United States – U.S. latest breaking news headlines video online

‘ Wholesale Inflation Posts Unexpected Decline in February | Economy – US News Youtube HD Video Online

Wholesale inflation took an unexpected dip in February as both prices for goods and services fell, the Labor Department reported on Wednesday.

The producer price index fell by 0.1% for the month, below estimates for a 0.3% increase, and down from the 0.3% rise in January. Producer prices are now running at a 4.6% annual rate.

While the core index, stripping out food and energy costs, increased by 0.2% in February, that was down from January’s 0.5%. Year over year, the core index is now up 4.4%.

Much of the decrease can be attributed to a decline in the price of food, especially eggs.

“Over 80 percent of the February decline in the index for final demand goods can be

attributed to a 36.1-percent drop in prices for chicken eggs,” the report said. “The indexes for residential natural gas, fresh and dry vegetables, diesel fuel, home heating oil, and primary basic organic chemicals also fell.”

Political Cartoons on the Economy

“Conversely, prices for iron and steel scrap advanced 10.6 percent,” the report added. “The indexes for gasoline and for sugar and confectionery products also increased.”

Both reports come ahead of the Federal Reserve’s meeting next week. That gathering has been thrown into confusion after two banks, Silicon Valley Bank and Signature Bank of New York, failed in recent days.

The federal government stepped in with emergency support in the form of a Fed lending facility and other relief, designed to protect depositors and shore up confidence in the banking system. While that gave some immediate comfort to the system, bank stocks came under pressure early Tuesday morning, and large banks such as Bank of America reported new inflows of deposits.

The Fed had been expected to raise interest rates by 50 basis points when it meets March 21-22, but that was scaled back after last week’s jobs report for February showed a moderation in labor demand and an improvement in wage inflation with the market expecting a hike of 25 basis points. But the banking crisis has even thrown that into doubt with some analysts saying the Fed may skip raising rates altogether.

“Even amid current banking scares, the Fed will still prioritize price stability over growth and likely hike rates by 0.25% at the upcoming meeting,” LPL Financial Chief Economist Jeffrey Roach said on Tuesday. “Shelter costs are poised to ease as more multifamily units come online throughout the year.”

Roach added that as more supply comes on the market, prices will decline and that will drive inflation lower in the second half of the year.

We update US news from official website – .

Subscribe to the US latest news headlines update. Subscribe to our newsletters and get all the latest business news, entertainment news, sports news, viral videos, and more here.

Leave a Reply

Your email address will not be published. Required fields are marked *