May 14, 2020 - Economy

Producer prices drop by the most since 2009

Costs for American vendors fell by the most since 2015 on a year-over-year basis and by the most since 2009 when measuring the month-over-month change last month.

Why it matters: The decline in U.S. producer prices was far more than expected and could bolster some economists’ predictions for a brief period of deflation as the novel coronavirus depresses demand.

  • April marked the third straight month producer prices have fallen.
  • That could bolster the case for more stimulus measures from the government or additional monetary policy response from the Fed.

Stay woke: The PPI is considered when adjusting prices in long-term purchasing agreements.

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