Producer prices fall in August, but core prices rise

The August Producer Price Index just hit the tape. I won't write much about it because the Consumer Price Index is more important. But suffice it to say that the headline PPI dropped sharply -- down 1.4% vs. expectations for a 0.3% decline. The only problem? These are August figures, and in August, the price of lots of commodities -- especially oil -- fell. Since then, they have rallied right back up. That means the September PPI won't look so good. Meanwhile, the "core" PPI rose 0.2% vs. market forecasts for a 0.1% rise.

In the earlier stages of processing, the headline intermediate goods measure fell 1.2% and the core intermediate goods measure dropped 0.5%. The headline crude goods price index dropped 3%, but the core crude goods index rose 1.3%.