US final demand prices rise more quickly than expected in September

Producer prices in the States increased more than expected last month, boosted by higher prices for food.

According to the US Department of Labor, so-called final demand prices rose at a month-on-month clip of 0.4%, leading to an acceleration in the year-on-year rate of price gains -0.2% to 0.4% (consensus: 0.2%).

Similarly, the annual rate of increases in core final demand prices, which exclude food, energy and trade, picked-up from 0.3% to 0.7%.

Prices for final demand goods and services were both up by 0.4% on the month.

Food prices were the main culprit behind the rise in the former, increasing by 1.2% versus August, albeit following three straight months of outright declines, including a steep 4.9% drop in June.

Energy prices on the other hand dipped by 0.3% on the month following a 0.1% fall in August.

In final demand services meanwhile, trade prices, which are linked to retailers' margins, advanced 0.2% alongside a 0.4% rise in those of transportation and warehousing and a 0.5% increase in 'other services'.