Producer Price Index Increases 1.3% in January – Largest Monthly Increase on Record

The U.S. Bureau of Labor Statistics reported today (2-17-21) that the Producer Price Index (PPI) for final demand, seasonally adjusted, increased 1.3% in January. January’s increase is the largest since the PPI began in December 2009. Final demand prices rose 0.3% in December and 0.1% in November. On an unadjusted basis the PPI for final demand moved up 1.7% for the 12 months ending January 2021, the largest increase since climbing 2.0% for the 12 months ending January 2020. Two-thirds of the January advance in prices for final demand can be traced to a 1.3% rise in the index for final demand services. Prices for final demand goods increased 1.4%. Prices for final demand less foods, energy, and trade services moved up 1.2% in January, the largest advance since the index began in September 2013. For the 12 months ended in January, prices for final demand less foods, energy, and trade services rose 2.0% the largest increase since a 2.1% advance for the 12 months ended June 2019.