Energy Inflation Ready to Pounce?

In case you missed the exciting release of the Producer Price Index today:

“The Producer Price Index for Finished Goods advanced 1.7 percent in August, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.”

Finished goods (which require energy) rose at an annualized rate of over 21%.

But wait!  It gets better:

“In August, over ninety percent of the finished goods increase was the result of higher energy prices, which moved up 8.0 percent.”

“Finished core: Prices for finished goods less foods and energy rose 0.2 percent in August after edging down 0.1 percent a month earlier.  Accounting for over half of this increase, the light motor trucks index moved up 0.8 percent. Higher prices for passenger cars also were a major factor in the advance in the finished core index.”

Did you catch that?  Finished goods LESS foods and energy rose .2 percent after edging down .1 percent a month earlier.   Products that require energy (just about everything) is up a whopping 8%.

It’s something you need to watch.

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