The 2020 Mid-Year Economic Update_long

Wholesale Prices Fall 0.2% in June

The Producer Price Index for Finished Goods decreased 0.2 percent in June, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported. This decline followed advances of 0.9 percent in May and 0.7 percent in April. At the earlier stages of processing, prices received by producers of intermediate goods rose 0.5 percent in June after increasing 1.1 percent in the prior month, and the crude goods index moved up 0.3 percent following a 2.0-percent advance in May.
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Among prices for finished goods, the index for energy goods fell 1.1 percent in June after rising 4.1 percent in May. Prices for consumer foods decreased 0.8 percent following a 0.2-percent decline in the previous month. By contrast, slightly counteracting the downturn in finished goods ...

construction moved up at a 3.5-percent SAAR after advancing at a 1.0- percent SAAR from June to December 2006.
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The index for materials for durable manufacturing increased 0.3 percent in June after moving up 0.2 percent in the prior month. Rising prices for copper and brass mill shapes, cold rolled steel sheet and strip, semifinished steel mill products, plywood, softwood lumber, and secondary aluminum more than offset falling prices for aluminum mill shapes and cold finished steel bars. The index for materials for durable manufacturing climbed at an 11.1-percent SAAR in the first half of 2007 after rising at a 2.0-percent SAAR in the prior 6-month period.
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Crude goods
The Producer Price Index for Crude Materials for Further Processing moved up 0.3 percent in June following a 2.0-percent increase in May. Prices for crude energy materials and for crude foodstuffs and feedstuffs rose less than they had in May. The index for basic industrial materials turned down after edging up in the prior month.

Prices for crude energy materials moved up 0.6 percent in June subsequent to a 4.3-percent increase a month earlier. In June, rising prices for crude petroleum and coal outweighed falling prices for natural gas. During the first half of 2007, the crude energy materials index advanced at a 3.5-percent SAAR after rising at a 13.7-percent SAAR in the previous 6-month period.
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The crude foodstuffs and feedstuffs index advanced 0.5 percent following a 1.1-percent increase in May. In June, higher prices for fluid milk, corn, wheat, soybeans, slaughter hogs, and slaughter turkeys outweighed lower prices for slaughter cattle, slaughter broilers and fryers, fresh fruit and melons, and unprocessed finfish. The index for crude foodstuffs and feedstuffs increased at a 33.9-percent SAAR in the first half of 2007 subsequent to rising at a 20.7-percent SAAR in the second half of 2006.
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Prices for crude nonfood materials less energy inched down 0.2 percent in June after edging up 0.1 percent in the preceding month. The copper base scrap index declined 6.6 percent following a 10.3-percent gain in May. Similarly, prices for wastepaper and pulpwood also turned down in June. The indexes for aluminum base scrap and for construction sand, gravel, and crushed stone were unchanged after increasing in the previous month. Prices for gold ores fell more than they had a month earlier. By contrast, partially offsetting the downturn in the basic industrial materials index, prices for iron and steel scrap advanced 1.4 percent in June subsequent to an 8.3-percent decrease in the prior month. The indexes for phosphates and for hardwood logs, bolts, and timber also turned up in June. Prices for raw cotton declined less than they had in May. From December 2006 to June 2007, the index for basic industrial materials increased at a 26.5-percent SAAR after decreasing at a 4.2-percent SAAR in the prior 6-month period. advance in May. Higher prices for light motor trucks, passenger cars, sanitary papers and health products, civilian aircraft, household furniture, and alcoholic beverages outweighed lower prices for electronic computers, commercial furniture, pharmaceutical preparations, and cosmetics and other toilet preparations.
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Intermediate goods
The Producer Price Index for Intermediate Materials, Supplies, and Components rose 0.5 percent in June following a 1.1-percent advance in the prior month. Prices for intermediate energy goods and materials for nondurable manufacturing increased less than they had in May. Conversely, partially offsetting the deceleration in intermediate goods prices, the indexes for intermediate foods and feeds, materials and components for construction, and materials for durable manufacturing rose more than in the previous month. Prices for intermediate goods other than foods and energy moved up 0.4 percent for the second consecutive month.
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The index for intermediate energy goods rose 0.3 percent in June after jumping 4.2 percent in May. The index for residual fuel increased 0.6 percent in June after climbing 7.8 percent a month earlier. Prices for gasoline, industrial electric power, jet fuels, and liquefied petroleum gas turned down after advancing in May. By contrast, the rise in the index for natural gas to electric utilities accelerated to 7.8 percent from 1.4 percent in the previous month. Prices for commercial natural gas also increased more in June, and the index for diesel fuel turned up after declining in May. From December 2006 to June 2007, the index for intermediate energy goods advanced at a 19.8-percent SAAR after dropping at a 9.4-percent SAAR in the previous 6-month period.
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The index for materials for nondurable manufacturingmoved up 1.8 percent in June after advancing 2.9 percent in the prior month. The increase in the index for primary basic organic chemicals slowed to 2.7 percent from 4.6 percent in May. Prices for plastic resins and materials and for intermediate basic organic chemicals also rose less than in the preceding month. Conversely, the increase in the fertilizer materials index accelerated to 4.8 percent in June from 0.5 percent a month earlier. Prices for basic inorganic chemicals also increased more than in the preceding month. The indexes for paper, processed yarns and threads, and synthetic rubber turned up after falling in May. The index for materials for nondurable manufacturing rose at a 15.4-percent SAAR during the first half of 2007 after declining at a 5.9-percent SAAR in the second half of 2006.
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Prices for intermediate foods and feeds moved up 1.6 percent in June after increasing 0.1 percent in the prior month. The index for prepared animal feeds turned up 2.2 percent after dropping 3.1 percent in May. Prices for flour, fluid milk products, and for natural, processed, and imitation cheese rose more than in the previous month. By contrast, the index for beef and veal turned down 3.3 percent after advancing 1.0 percent in the prior month. Prices for pork also decreased after rising in May. The index for shortening and cooking oils increased less in June, and prices for processed young chickens fell more than in May. During the first half of 2007, the index for intermediate foods and feeds rose at a 20.3-percent SAAR after advancing at a 10.6-percent SAAR in the second half of 2006.
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The index for materials and components for construction moved up 0.4 percent in June after advancing 0.3 percent a month earlier. Price increases for nonferrous wire and cable, plywood, asphalt felts and coatings, wiring devices, softwood lumber, treated wood, and concrete products outweighed price decreases for plastic construction products. From December 2006 to June 2007, prices for materials and components forThe Producer Price Index for Finished Goods decreased 0.2 percent in June, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported. This decline followed advances of 0.9 percent in May and 0.7 percent in April. At the earlier stages of processing, prices received by producers of intermediate goods rose 0.5 percent in June after increasing 1.1 percent in the prior month, and the crude goods index moved up 0.3 percent following a 2.0-percent advance in May.
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Among prices for finished goods, the index for energy goods fell 1.1 percent in June after rising 4.1 percent in May. Prices for consumer foods decreased 0.8 percent following a 0.2-percent decline in the previous month. By contrast, slightly counteracting the downturn in finished goods prices, the index for finished goods other than foods and energy increased 0.3 percent in June compared with a 0.2-percent rise in May.
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During the first 6 months of 2007, the finished goods index rose at a 6.4-percent seasonally adjusted annual rate (SAAR) after no change during the latter half of 2006. Prices for finished energy goods climbed at an 18.4-percent from December 2006 to June 2007 after declining at an 8.2- percent for the 6 months ended December 2006. The index for finished consumer foods moved up at a 7.8-percent during the first half of 2007 after increasing at a 4.9-percent during the second half of 2006.
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Prices for finished goods other than foods and energy advanced at a 2.3- percent for the 6 months ended June 2007 after rising at a 1.3-percent during the prior 6-month period. At the earlier stages of processing, the intermediate goods index increased at an 8.0-percent from December 2006 to June 2007 after falling at a 1.0-percent during the latter half of 2006, and prices for crude goods advanced at an 18.6-percent for the 6 months ended in June after moving up at an 11.3-percent for the 6 months ended in December.
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Before seasonal adjustment, the Producer Price Index for Finished Goods fell 0.4 percent in June to 167.1 (1982 = 100). From June 2006 to June 2007, prices for finished goods increased 3.3 percent. Over the same period, the index for finished consumer foods rose 6.5 percent, prices for finished energy goods climbed 4.7 percent, and the index for finished goods other than foods and energy advanced 1.8 percent. For the 12 months ended June 2007, prices received by intermediate goods producers moved up 3.7 percent, and the crude goods index increased 14.8 percent.
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Finished goods
Prices for finished energy goods declined 1.1 percent in June after increasing 4.1 percent in May. The gasoline index fell 3.9 percent following a 10.2-percent jump in the previous month. Prices for liquefied petroleum gas, residential electric power, home heating oil, and finished lubricants also turned down after rising in May. By contrast, slightly counteracting the downturn in the finished energy goods index, residential natural gas prices advanced 2.6 percent in June following a 0.9-percent increase a month earlier. The index for diesel fuel turned up after decreasing in May.
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Prices for finished consumer foods fell 0.8 percent in June following a 0.2-percent decrease in May. The index for fresh fruits and melons declined 14.9 percent after climbing 12.1 percent in the preceding month. Prices for eggs for fresh use, beef and veal, pork, processed fruits and vegetables, and soft drinks also turned down following increases in May. The index for processed young chickens decreased more in June than it had in the prior month. By contrast, prices for fresh and dry vegetables rose 0.2 percent following a 35.0-percent drop a month earlier. The index for dairy products advanced more in June than it had in May.
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The index for finished goods other than foods and energy increased 0.3 percent in June following a 0.2-percent

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