It’s Friday and that means it’s time to review the latest economic data and identify which pockets of the economy are heating up and which are slowing down. Don’t worry about catching every headline and every report throughout the week—I recap all of the most important news impacting your wealth right here every Friday. Let’s take a look at this week’s big headlines:
Producer Price Index (PPI)
In September, increases in energy and food prices supported U.S. producer prices, overall. The Labor Department reported that its Producer Price Index (PPI) jumped 0.3% last month, as energy prices climbed 2.5% and food prices rose 0.5%. Inflation, though, remains tame. When you strip out energy and food, core inflation only increased 0.3% in September. And in the past year, wholesale prices only rose 0.7%, which is well below the Fed’s 2% inflation target.
The Commerce Department announced this morning that retail sales rose 0.6% in September, just below economists’ estimates for a 0.7% increase. Despite the miss, the increase in retail sales last month was a welcome relief after negative sales growth in August and only a 0.1% increase in July. The positive retail sales growth in September will also support third-quarter GDP growth. Economists may still trim their GDP estimates a bit, since they were expecting a bigger increase in retail sales. But, overall, the September retail sales report was encouraging.
The Commerce Department also reported today that business inventories increased 0.2% in August, while July inventories remained unchanged. Inventories were supported by retailers restocking their shelves, as retail inventories jumped 0.6% in August. Economists are now looking for inventories to rebound in the third quarter, which will help support GDP growth.
That’s all I have for you this week; I’ll be back online on Monday with your weekly ratings changes.
Have a great weekend,