Around the end of 2018, the annual rate of prices received by producers began a downtrend which then continued through 2019. Recent figures had suggested this trend may have finished, although the latest figures have retained some ambiguity in this regard.
The figures from October have been published by the Bureau of Labor Statistics and they indicate producer prices increased by 0.4% after seasonal adjustments. The result was above the 0.3% increase which had been expected and a noticeable turnaround from September’s -0.3%. However, on a 12-month basis, the rate of producer price inflation after seasonal adjustments slowed to 1.0% after recording 1.4% in September and 1.8% in August.
“Core” PPI inflation increased by 0.3%, which is a marked turnaround from September’s comparable figure of -0.3%. Its annual rate dropped for a second consecutive month, this time from 1.9% to 1.5%.
US Treasury bond yields finished lower. By the end of the day, US 2-year Treasury yields had lost 3bps to 1.61%, the 10-year yield had fallen by 7bps to 1.82% and the 30-year yield finished 6bps lower at 2.31%.