regular monthly reports that were released this week included the the April Consumer Price Index, the April Producer Price Index, and the April Import-Export Price Index from the Bureau of Labor Statistics, and the Retail Sales report for April, the Wholesale Trade, Sales and Inventories report for March, and the Business Sales and Inventories report for March from the Census Bureau…in addition, the BLS also released the Job Openings and Labor Turnover Survey (JOLTS) for March…
Consumer Prices Rose 0.2% in April on Higher Energy and Shelter Costs
the consumer prices increased by 0.2% in April, as higher prices for energy and shelter more than offset lower prices for most other goods and services…the Consumer Price Index Summary from the Bureau of Labor Statistics indicated that the seasonally adjusted price index for urban consumers rose 0.2% in April, after it had dropped 0.3% in March, but after it had risen 0.1% in February, 0.6% in January, 0.3% in December, 0.2% in November, 0.4% in October, 0.3% in September, and 0.2% in August….the unadjusted CPI-U, which was set with prices of the 1982 to 1984 period equal to 100, rose to 244.524 in April from 243.801 in March, which left it statistically 2.200% higher than the 239.261 index reading in April of last year…with higher prices for energy a major contributor to the increase in the overall index, seasonally adjusted core prices, which exclude food and energy, rose by 0.1% for the month, with the unadjusted core index rising from 251.290 to 251.642, which left the core index 1.883% ahead of its year ago reading of 246.992…
the volatile seasonally adjusted energy price index increased by 1.1% in April, after it had fallen by 3.2% in March and by 1.0% in February, but after it had risen by 4.0% in January, 1.5% in December, 1.2% in November, 3.5% in October, and by 2.9% in September…thus, energy prices are now averaging 9.3% higher than a year ago, after seeing negative year over year comparisons through most of 2015 and 2016…prices for energy commodities were 1.3% higher in April, while the index for energy services rose by 0.9%, after falling 0.3% in March….the increase in the energy commodity index included a 1.2% increase in the price of gasoline, the largest component, and a 3.8% seasonally adjusted increase in the index for fuel oil, even as the underlying price of fuel oil fell 0.3% on an unadjusted basis…within energy services, the index for utility gas service rose by 2.2% after falling by 0.8% in March, but utility gas is still priced 12.0% higher than it was a year ago, while the electricity price index was up 0.6%, after it slipped 0.1% in March….energy commodities are still priced 14.5% above their year ago levels, with gasoline prices averaging 14.3% higher than they were a year ago.…meanwhile, the energy services price index is 4.4% higher than last April, as even electricity prices have increased by 2.4% over that period..
the seasonally adjusted food price index rose 0.2% in April, after rising 0.3% in March, 0.2% in February, and 0.1% in January, but after being unchanged for the 6 prior months, as prices for food purchased for use at home rose 0.2% while prices for food bought to eat away from home also rose 0.2%, with average prices at fast food outlets up 0.3%, while average prices at full service restaurants were 0.2% higher…in the food at home categories, the price index for cereals and bakery products decreased by 0.3% as prices for flour and mixes were 1.7% lower…the price index for the meats, poultry, fish, and eggs group was down 0.6% as pork prices fell 0.7%, chicken prices fell 1.9%, and fresh fish prices fell 2.1%, while the index for dairy products was 0.2% lower on 1.3% decrease in the price of milk….the fruits and vegetables index, on the other hand, was 2.2% higher on a 5.1% increase in prices for fresh vegetables, led by an 18.0% increase in the price of lettuce….the beverages index was 0.3% lower as noncarbonated juices and drink prices fell 0.5%….lastly, prices in the ‘other foods at home’ category were on average 0.1% higher, as olives, pickles and relishes averaged a 3.1% decrease while frozen and freeze dried foods rose 1.7%…..among food at home line items, only eggs, which are still priced 15.8% lower than a year ago, and lettuce, which is now up 14.3% year over year, have seen price changes greater than 10% over the past year…the itemized list for price changes in over 100 separate food items is included at the beginning of Table 2, which gives us a line item breakdown for prices of more than 200 CPI items overall…
among the seasonally adjusted core components of the CPI, which rose by 0.1% in April after falling by 0.1% in March but after rising by 0.2% in February, 0.3% in January, 0.2% in December, 0.2% in November, 0.1% in October, 0.1% in September, 0.3% in August, 0.1% in July and by 0.2% last April, May and June, the composite of all goods less food and energy goods was down 0.2%, while the more heavily weighted composite for all services less energy services was 0.1% higher….among the goods components, which will be used by the Bureau of Economic Analysis to adjust April retail sales for inflation in national accounts data, the index for household furnishings and supplies fell by 0.3%, as prices for furniture and bedding fell 0.6% and laundry equipment fell 1.2%…the apparel price index was also 0.3% lower, led by a 2.5% decrease in prices for men’s apparel….prices for transportation commodities other than fuel were down 0.2%, as prices for new vehicles fell 0.2% and prices for used cars and trucks fell 0.5%…prices for medical care commodities were 0.8% lower on a 0.9% decrease in prescription drug prices….in addition, the recreational commodities index fell 0.5% on 5.2% lower prices for sewing machines and fabric supplies and 1.2% lower priced toys, while the education and communication commodities index was 0.7% lower on a 1.2% decrease in prices for college textbooks and a 0.9% decrease in prices for computer software…lastly, a separate price index for alcoholic beverages was unchanged, while the price index for ‘other goods’ was up 1.9% on a 4.5% increase in prices for cigarettes…
within core services, the price index for shelter rose 0.3% on a 0.3% increase in rents, a 0.2% increase in owner’s equivalent rent, and a 2.4% increase in lodging away from home at hotels and motels, while the household operations services index was up 0.1%….the index for medical care services was unchanged as prices for hospital services rose 1.0% while physicians services fell 1.2%…meanwhile, the transportation services index was 0.2% lower on a 1.6% decrease in car and truck rental and a 2.9% decrease in intercity train fare…the recreation services price index was unchanged, as higher video and audio services were offset by lower admissions and club fees…the index for education and communication services was 0.2% lower as charges for wireless telephone services were 1.7% lower…lastly, the index for other personal services was up 0.1% as laundry and dry cleaning services were 0.4% higher…among core prices, only televisions, which are still 17.9% cheaper than a year ago, and wireless phone services, which have now dropped 12.9% from a year ago, have seen prices drop by more than 10% over the past year, while nothing has seen prices rise by a double digit magnitude..
April Retail Sales Up 0.4% after March Sales Revised Higher
this week’s retail sales report for April was preceded by an April 26th benchmark revision based on the results of the 2015 Annual Retail Trade Survey, which revised prior estimates of retail sales all the way back to 1992…thus this release reports changes from that revision, as if the prior reports we’ve covered had never been published…from that revised figure for March then, the Advance Retail Sales Report for April (pdf) from the Census Bureau estimated that our seasonally adjusted retail and food services sales totaled $474.9 billion for the month, which was a increase of 0.4 percent (±0.5%)* from March sales of $473.1 billion and 4.5 percent (±0.9 percent) above the adjusted sales of April of last year…March sales were originally reported at $470.8 billion, down 0.2% from February; they are now indicated to have risen 0.1%….estimated unadjusted sales, extrapolated from surveys of a small sampling of retailers, indicated unadjusted sales fell 3.6%, from $484,144 in March to $466,734 in April, while they were up 1.0% from the $ 461,954 million of sales in April a year ago…..
once again, we are including below the table of monthly and yearly percentage changes in sales by business type taken from the Census pdf….taking into account the benchmark revision, the first double column below gives us the seasonally adjusted percentage change in sales for each type of retail business type from March to April in the first sub-column, and then the year over year percentage change for those businesses since last April in the 2nd column; the second pair of columns gives us the revision of last month’s March advance monthly estimates (now called “preliminary”) as revised in this report, likewise for each business type, with the February to March change under “Feb 2017 revised” and the revised March 2016 to March 2017 percentage change in the last column shown…for your reference, our copy of the table of last month’s advance March estimates, before the benchmark revision, is here….
because April consumer prices were generally lower across the board, real sales for April will tend to be higher than those shown above; the exceptions are for food, where prices rose 0.2%, and for gasoline sales, where prices rose 1.2%…ie, the 0.2% food price increase, combined with the 0.4% decrease in grocery store sales, would imply that real food consumption was down by 0.6%…on the other hand, the 0.6% decrease in furniture prices implies a real increase of 0.1% in the quantity of furniture sold, despite the 0.5% decrease in furniture store sales…likewise, the 0.8% nominal increase in sales at auto dealerships implies at least a 1.0% increase in real unit auto sales, since new vehicles prices were down 0.2% and prices for used cars and trucks were 0.5% lower…without working out the precise details on an item by item basis, we’d estimate that real retail sales were up around 0.6% in April, maybe more, in a strong start to 2nd quarter PCE…
Producer Prices Rose 0.5 in April on Higher Food and Energy Prices
the seasonally adjusted Producer Price Index (PPI) for final demand rose 0.5% in April, as prices for finished wholesale goods increased 0.5%, while margins of final services providers increased by 0.4%…this followed a March that indicated the PPI was 0.1% lower, with prices for finished wholesale goods down 0.1%, while margins of final services providers also decreased by 0.1%, and a February report that indicated the PPI was 0.3% higher, with prices for finished wholesale goods up 0.3%, while margins of final services providers increased by 0.4%….on an unadjusted basis, producer prices are now 2.5% higher than a year earlier, up from the 2.3% YoY increase indicated a month ago, for the largest year over year increase since February 2012…
as noted, the price index for final demand for goods, aka ‘finished goods’, rose by 0.5% in April, after falling by 0.1% in March, but after rising by 0.3% in February, 1.0% in January, 0.6% in December, 0.1% in November, 0.3% in October, and 0.5% in September.. the index for wholesale energy prices rose 0.8%, the price index for wholesale foods rose 0.9%, and the index for final demand for core wholesale goods (ex food and energy) rose 0.3%…the largest wholesale energy price change was a 5.2% increase in wholesale prices for liquefied petroleum gas, while the wholesale food price index moved up on increases of 19.8% for fresh fruits and 28.5% for fresh and dry vegetables….among wholesale core goods, prices for industrial chemicals increased 1.2%, while wholesale prices for cigarettes moved up 2.2%..
at the same time, the index for final demand for services rose by 0.4% in April, after falling by 0.1% in March but after after rising by 0.4% in February, and by 0.2% in January, as the index for final demand for trade services was down 0.3%, while the index for final demand for transportation and warehousing services rose 0.7%, and the index for final demand for services less trade, transportation, and warehousing services was 0.8% higher….among trade services, seasonally adjusted margins for major household appliances retailers decreased 8.5% while margins for fuels and lubricants retailers fell 14.6%…among transportation and warehousing services, margins for airline passenger services were 2.0% higher…in the core final demand for services index, margins for loan services (partial) rose 4.1% and margins for securities brokerage, dealing, and investment advice rose 6.6%..
this report also showed the price index for processed goods for intermediate demand was 0.5% higher, after rising 0.1% in March, 0.4% in February, 1.1% in January, and by a revised 0.6% in December… the price index for intermediate energy goods rose 1.3%, while prices for intermediate processed foods and feeds fell 0.6%, and the core price index for processed goods for intermediate demand less food and energy was 0.5% higher…prices for intermediate processed goods are now 5.4% higher than in April a year ago, now the sixth consecutive year over year increase, after 16 months of lower year over year comparisons, as intermediate goods prices fell every month from July 2015 through March 2016….
meanwhile, the price index for intermediate unprocessed goods rose 3.3% in April, after falling 4.2% in March and 0.2% in February, but after rising 4.0% in January and 7.3% in December…the index for crude energy goods rose 14.1% as crude oil prices rose 15.7%, while the price index for unprocessed foodstuffs and feedstuffs fell 2.3%, as the index for slaughtered hogs fell 10.7%…in addition, the index for core raw materials other than food and energy materials fell 0.7%, as wholesale prices for iron and steel scrap fell 5.2% and wholesale prices for paper scrap fell 6.3% … this raw materials index is now up 13.9% from year ago, in contrast to a prior year over year decrease of 26.4% that we saw just 17 months ago, in November of 2015…
lastly, the price index for services for intermediate demand was 0.9% higher in April, after being 0.2% lower in March, 0.5% higher in February, and 0.2% higher in January and in December.. the index for trade services for intermediate demand was 0.7% higher, as margins for chemical products wholesalers and hardware, building material, and supplies wholesalers both rose 2.5%…the index for transportation and warehousing services for intermediate demand was up 0.4%, as intermediate prices for air transportation of passengers rose 1.9%…meanwhile, the core price index for services less trade, transportation, and warehousing for intermediate demand rose 1.0%, as the intermediate price index for loan services (partial) rose 4.5% percent…over the 12 months ended in February, the year over year price index for services for intermediate demand, which has never turned negative on an annual basis, is now 2.6% higher than it was a year ago…
March Business Sales Unchanged, Business Inventories Up 0.2%
after the release of the April retail sales report, the Census Bureau also released the composite Manufacturing and Trade, Inventories and Sales report for March (pdf), which incorporates the revised March retail data from that April report and the earlier published March wholesale and factory data to give us a complete picture of the business contribution to the economy for that month….according to the Census Bureau, total manufacturer’s and trade sales were estimated to be valued at a seasonally adjusted $1,361.0 billion in March, actually unchanged (±0.1 percent)* from February’s revised sales, but up 6.5 percent (±0.4 percent) from March sales of a year earlier…note that total February sales were concurrently revised up from the originally reported $1,360.7 billion to $1,361.0 billion, still a 0.2% increase from January….manufacturer’s sales fell 0.1% to $478,815 million in February; retail trade sales, which exclude restaurant & bar sales from the revised February retail sales reported earlier, rose 0.1% to $416,686 million, while wholesale sales were virtually unchanged at $465,492 million…
meanwhile, total manufacturer’s and trade inventories, a major component of GDP, were estimated to be valued at a seasonally adjusted $1,840.8 billion at the end of March, up 0.2 percent (±0.1%) from the end of February, and 2.6 percent (±0.3%) higher than in March a year earlier…at the same time, the value of end of February inventories was revised down from the $1,839.9 billion reported last month to $1,836,877 million, now just 0.2% higher than January….seasonally adjusted inventories of manufacturers were estimated to be valued at $629,747 million, statistically unchanged from February, and inventories of retailers were valued at $616,522 million, 0.5% more than in February, while inventories of wholesalers were estimated to be valued at $594,563 million at the end of March, 0.2% higher than in February…
Job Quitting Increases in March; Job Openings, Hiring, and Layoffs Little Changed
the Job Openings and Labor Turnover Survey (JOLTS) report for March from the Bureau of Labor Statistics estimated that seasonally adjusted job openings increased by 61,000 to 5,743,000 in March, after February job openings were revised down 61,000 from the originally reported 5,743,000…March’s jobs openings were still down from the 5,852,000 job openings reported in March a year ago, as the job opening ratio expressed as a percentage of the employed was unchanged at 3.8% in March, while it was down from the 3.9% rate of March a year ago…(details on job openings by industry and region can be viewed in Table 1)…like most BLS releases, the press release for this report is easy to understand and also refers us to the associated table for the data cited, which are linked at the end of the release…
the JOLTS release also reports on labor turnover, which consists of hires and job separations, which in turn is further divided into layoffs and discharges, those who quit, and ‘other separations’, which includes retirements and deaths….in March, seasonally adjusted new hires totaled 5,260,000, up by 11,000 from the revised 5,249,000 who were hired or rehired in February, as the hiring rate as a percentage of all employed remained unchanged at 3.6% in March, which was down from the 3.7% hiring rate in March a year earlier (details of hiring by sector since October are in table 2)….meanwhile, total separations rose by 80,000 to 5,088,000 in March, as the separations rate as a percentage of the employed rose from 3.4% to 3.5%, same as a year ago (see table 3)…subtracting the 5,071,000 total separations from the total hires of 5,314,000 would imply an increase of 178,000 jobs in March, more than double the revised payroll job increase of 79,000 for March reported in the April establishment survey last week but still within the expected +/-115,000 margin of error in these incomplete samplings…
breaking down the seasonally adjusted job separations, the BLS founds that 3,116,000 of us voluntarily quit our jobs in March, up from the revised 3,036,000 who quit their jobs in February, while the quits rate, widely watched as an indicator of worker confidence, remained unchanged at 2.1% of total employment, while it was up from 2.0% a year earlier (see details in table 4)….in addition to those who quit, another 1,615,000 were either laid off, fired or otherwise discharged in March, up by 21,000 from the revised 1,594,000 who were discharged in February, as the discharges rate remained unchanged at 1.1% of all those who were employed during the month…meanwhile, other separations, which includes retirements and deaths, were at 357,000 in March, down from 378,000 in February, for an ‘other separations rate’ of 0.2%, down from 0.3% in February and in March of last year….both seasonally adjusted and unadjusted details by industry and by region on hires and job separations, and on job quits and discharges can be accessed using the links to tables at the bottom of the press release…
(the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most from the aforementioned GGO posts, contact me…)
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