US PPI remained unchanged in August – September report

The producer price index was published today. It showed that the rate of PPI for
finished goods didnt change in August compared to a 0.2% increase (seasonally
adjusted) during July. This report also serves as an indicator to the upcoming
core CPI to be published tomorrow in the U.S. The food index is one of the
factors that inclined during August by 1.1%, while the energy index fell by
1.0%. As a result, the PPI inclined by 6.5% during the past 12 months. The
Producer Price index excluding food and energy slightly rose by 0.1% during
August. The last index (PPI ex food and energy) is estimated to have a lagged
negative linear correlation with gold price; i.e. as the PPI rises, gold price
tends to fall the following day. Furthermore, the PPI excluding food and energy
has a positive linear correlation with silver price. These relations are mainly
directed via the US dollar changes.