US wholesale prices dropped 0.5% last month despite President Trump's tariffs

[BumRushDaShow]

Source: Yahoo! Finance/AP

Thu, May 15, 2025 at 8:43 AM EDT


WASHINGTON (AP) — U.S. wholesale prices dropped unexpectedly in April for the first time in more than a year despite President Donald Trump’s sweeping taxes on imports.

The producer price index — which tracks inflation before it hits consumers — fell 0.5% last month from March and rose 2.4% from April 2024, the U.S. Labor Department reported Thursday.

Excluding volatile food and energy prices, so-called core wholesale prices dipped 0.4% from March and rose 3.1% from a year earlier. Economists had expected that producer prices rose modestly in April. A 0.7% drop in services prices brought the index down.

On Tuesday, the Labor Department reported that consumer prices rose just 2.3% last month from April 2024 — smallest year-over-year gain in more than four years. Economists have predicted that Trump’s tariffs would drive up prices, and many expect the impact to show up in June or July.

Read more: https://finance.yahoo.com/news/us-wholesale-prices-dropped-0-124312090.html

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It's nuts this morning because most of the financial sites are fixated on Powell and a speech he is giving and have all but ignored the government releases this morning.

[Bengus81]

1. That haven't really taken effect yet. DUHHHHH....Let's see those numbers in August/Sept

[progree]

2. We had quite a discussion about this in the Economy Group. And here is a little summary:

Last edited Thu May 15, 2025, 07:59 PM - Edit history (2)

BLS news release https://www.bls.gov/news.release/ppi.nr0.htm

I use a double minus to make minuses stand out more:

I highlight the latest numbers (April and the 12 month number).

Regular PPI: Jan-Apr, month by month: +0.7%, +0.2%, +0.0%, --0.5%), 12 months: +2.4%,
The average of the last 3 months annualizes to a --1.2% rate (using the actual index numbers for this calculation)


This is the core measure that the BLS highlights:
Core PPi (ex food, energy, and trade services): Jan-Apr: +0.4%, +0.4%, +0.2%, --0.1%, 12 months: +2.9%
The average of the last 3 months annualizes to a +1.8% rate (using the actual index numbers for this calculation)


This is the core measure that the media usually highlights
Core PPI (ex food & energy): Jan-Apr: +0.6%, +0.2%, +0.4, --0.4%, 12 months: +3.1%


Economy Group discussion: a lot about whether this is good news for the regime or not, or whether the sharp drops in the regular and the ex food & energy core, are, or will be seen as near-recessionary
https://www.democraticunderground.com/1116100490

[BumRushDaShow]

4. I consider this (the imposition of broad tariffs)

a "shock", analogous to (but not the same as) the pandemic shock back in 2020. None of the statistical models can predict the outcome of stuff like that well.

There was a rush by a number of industries to "stock up" ahead of the tariffs so their warehouses were full. But as I've seen noted in some articles, you really won't see the "effects" until the summer. Apparently Powell is in that camp noting how "volatile" inflation is (at least with the current circumstances).

[Vinca]

3. You could have fooled me. I just got back from the grocery store and they might as well charge for

visiting the steaks you might want to grill because no one can afford them.

[BumRushDaShow]

5. That's because like the price of eggs

(that I had paid almost $5/dozen for a couple weeks ago) the RETAIL prices haven't really gone down much (and in the OP's case, this is about the WHOLESALERS, where the RETAILERS are apparently trying to get the last gouging in that they can - despite cheap wholesale prices for them).

[LauraInLA]

7. I just read an article about the fact that beef producers have fewer calves than usual, keeping prices high.

Some producers are choosing to sell of their stock now bc of the high prices, but others worry that doing that will mean it takes longer to replenish their herds.

[Ferrets are Cool]

6. Am I really supposed to believe ANYTHING coming from this corrupt regime? "According to the Labor Dept"

is a red flag if I've ever seen one. I don't trust ANYTHING in this administration.

[DENVERPOPS]

8. Agreed

It is just like when Reagan doctored the Consumer Price Index in the 80's......and the CPI hasn't reflected anything near Reality ever since....