Core wholesale inflation up most in 6 months

[WestVirginiaRebel]

Yahoo News:

WASHINGTON (AP) -- A key measure of wholesale inflation rose in July by the most in six months.

The measure, called core wholesale inflation, excludes volatile food and energy prices. It surged 0.4 percent last month.

But most economists say they aren't concerned about the increase. One reason is that it was driven largely by costlier tobacco products and pickup trucks, which economists say are probably one-time events.

Raw material prices also fell in July. Those figures should lead to lower wholesale prices in coming months.

And the costs of components are rising more slowly than the costs of the finished goods calculated in the inflation measure.

The Federal Reserve and private economists tend to focus on core inflation. It's seen as a better predictor of price changes than overall inflation is.

Higher wholesale prices tend to raise pressure on department stores, groceries and restaurants to pass along higher costs to consumers. But that will be difficult now at a time of high unemployment and stagnant wages, which have caused consumers to tighten spending.

Combined with falling oil and gas prices, lower consumer spending should slow inflationary pressures, economists say.
________

So, there is an upside to being out of work and having less money to spend...

[Valin]

Yahoo News:

 

WASHINGTON (AP) -- A key measure of wholesale inflation rose in July by the most in six months.

 

The measure, called core wholesale inflation, excludes volatile food and energy prices. It surged 0.4 percent last month.

 

But most economists say they aren't concerned about the increase. One reason is that it was driven largely by costlier tobacco products and pickup trucks, which economists say are probably one-time events.

 

Raw material prices also fell in July. Those figures should lead to lower wholesale prices in coming months.

 

And the costs of components are rising more slowly than the costs of the finished goods calculated in the inflation measure.

 

The Federal Reserve and private economists tend to focus on core inflation. It's seen as a better predictor of price changes than overall inflation is.

 

Higher wholesale prices tend to raise pressure on department stores, groceries and restaurants to pass along higher costs to consumers. But that will be difficult now at a time of high unemployment and stagnant wages, which have caused consumers to tighten spending.

 

Combined with falling oil and gas prices, lower consumer spending should slow inflationary pressures, economists say.

________

 

So, there is an upside to being out of work and having less money to spend...

 

 

I've been warning people about this since late last year.