US wholesale inflation undershoots forecasts in November

Wholesale inflation in the US rose by less than expected last month amid a downdraft in the cost of services, but some economists cautioned that the underlying trends were not quite as weak as the headline readings.

According to the Department of Labor, so-called final demand prices were unchanged from the month before, as a 0.3% rise month-on-month in goods prices offset a 0.3% drop in those for services.

Among the latter, trade services prices, which track wholesale and retail margins, dropped by 0.6% versus October, alongside a 0.3% fall in the price of transportation and warehousing services and a 0.1% dip in 'other' services.

In comparison to a year ago, final demand prices were ahead by 1.1% (consensus: 1.2%).

Commenting on the figures, Pantheon Macroeconomics's Ian Shepherdson said that, despite appearances, the trend in healthcare services prices was accelerating, although core goods prices was slowing "following the downdraft in Chinese manufactured goods PPI inflation".

Nonetheless, he also said that: "underlying PPI trends aren't as weak as [November] headlines."