Producer Price Index (PPI) rises moderately in March

The report from the US Bureau of Labor Statistics shows that the final demand PPI slightly increased in March, with a year-on-year increase of 0.2%. The growth has slowed down compared to 0.6% in February and 0.4% in January. On an annual basis, PPI rose by 2.1%, the largest annual increase since April 2023.

Services drive exponential growth

A key driving factor for PPI in March was a 0.3% increase in final demand services. The growth in this part is mainly due to a significant increase in securities brokerage, trading, investment consulting, and related services, with a growth rate of 3.1%. However, not all fields are thriving, and passenger accommodation services have decreased by 3.8%.

Commodities show slight decline

In contrast to the service industry, the final demand for goods decreased by 0.1%, mainly due to a 1.6% decrease in final demand for energy. The price of gasoline has significantly decreased by 3.6%. Despite this decline, there are also areas of growth, such as a significant 10.7% increase in the price of processed poultry meat.

Core PPI remains stable

Excluding volatile industries such as food, energy, and trade services, the core PPI rose by 0.2% in March, continuing the 0.3% increase in February. In the past 12 months, this indicator has increased by 2.8%.

Market forecast

Considering the mild rise in PPI and stable growth of the core index, the market outlook remains cautious and optimistic. Especially in the areas of finance and investment services, the service industry has shown resilience and may offset a slight decline in commodities, especially energy. In the short term, traders anticipate that the market may trend stable or even bullish, provided that there have been no significant economic disruptions or policy changes.