Producer Price Index Volatility Going Back To 1930, 1947 (BLS)

The PPI (Producer Price Index) declined 0.9% in July. I provided historical PPI charts below including the PPI: Finished Goods month over month percent change and 12 month percent change since 1947 and the PPI: All Commodities 12 month percent change since 1913. As you can see from the charts in late 2008 producer prices deflated to levels not seen since the 1930s (all commodities) and 1949 (finished goods - when BLS started reporting PPI data). In the beginning of 2009 we bounced back from deflationary pressures and declined 0.9% in July more than expected. So there's been interesting producer price volatility. The question is will the deflationists (Gary Shilling) be right going forward or will the bounce back in business inventories and underlying consumer demand bid up prices with the help from stimulus dollars and low interest rates.

"The Producer Price Index for Finished Goods declined 0.9 percent in July, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This decrease followed advances of 1.8 percent in June and 0.2 percent in May. At the earlier stages of processing, prices received by manufacturers of intermediate goods moved down 0.2 percent in July after rising 1.9 percent in the prior month, and the crude goods index fell 4.5 percent following a 4.6-percent increase in June. (See table A.)

The downturn in finished goods prices was broad based. The index for energy goods fell 2.4 percent in July after climbing 6.6 percent a month earlier, prices for consumer foods decreased 1.5 percent following a 1.1-percent advance in the previous month, and the index for goods other than foods and energy edged down 0.1 percent compared with a 0.5-percent rise in June."

Full release with tables at BLS.gov

PPI: Finished Goods (1 Month Percent Change) BLS.gov

PPI: Finished Goods (1 Month Percent Change Historical) BLS.gov

PPI: Finished Goods (12 month Percent Change Historical) BLS.gov

PPI: All Commodities (12 month Percent Change Historical) St. Louis Fed

Other historical posts:
Dow 1929 Bear Market Rally Compared To 2009 Rally (Charts) - August 9
Charts Comparing 1974, 1982, 2002 Market Bottoms To Today, 80s Recovery - June 7
USD Index Went From 92 to 151 In '80s. A Look At USD, CPI and Fed Funds During 80s Recession - March 29