BLS DAILY REPORT, FRIDAY, MARCH 17, 2000
RELEASED TODAY:
CONSUMER PRICE INDEX -- On a seasonally adjusted basis, the CPI-U rose
0.5 percent in February, following increases of 0.2 percent in each of the
preceding 4 months. The food index, which declined 0.1 percent in January,
increased 0.4 percent in February, reflecting in part a sharp jump in meat
prices. The energy index rose 4.6 percent, its largest advance since a 6.0
percent rise in April 1999. The index for petroleum-based energy increased
8.0 percent, and the index for energy services rose 1.1 percent. Excluding
food and energy, the CPI-U rose 0.2 percent in February, the same as in
January. ...
REAL EARNINGS -- Real average weekly earnings decreased by 0.5 percent
from January to February, after seasonal adjustment. This was due to a
decrease of 0.3 percent in average weekly hours and an increase of 0.5
percent in the CPI-W. This was partially offset by a 0.3 percent increase
in average hourly earnings. ... Real average weekly earnings were unchanged
from February 1999 to February 2000. ...
__A sharp spike in oil prices drove up the producer price index for finished
goods 1 percent in February, the largest monthly gain since an identical
increase in October 1990, BLS reported. Despite the large increase, many
economists agreed that inflation at the producer level is relatively stable,
with only a few trouble spots. ... Joseph Kowal, a BLS economist, said
energy price hikes accounted for 0.7 percent of the 1 percent February
increase. The core rate -- minus often volatile prices for energy and food
-- increased a stronger than usual 0.3 percent in February. But, analysts
noted that a 6.3 percent rise in cigarette prices drove up the core rate.
The large February increase followed stable producer prices in January. ...
(Daniel J. Roy in Daily Labor Report, page D-1),
__Huge increases in the prices of gasoline and home heating oil catapulted
wholesale prices up 1 percent in February -- the biggest 1-month increase in
nearly a decade. ... (Washington Post, page E3).
The number of people filing claims with state agencies for unemployment
insurance benefits dropped by 19,000 to a seasonally adjusted 262,000 in the
week ended March 11. ... (Daily Labor Report, page D-10).
Housing starts rose 1.3 percent in February from the previous month, but a
sharp rise in multifamily starts masked a modest dip in single-family
activity, the Commerce Department says. ... (Daily Labor Report, page
D-12).
__Inflation at the producer level was absent from the nation's economy last
month with the exception of higher costs for oil and tobacco products, BLS
figures showed. Other reports showing gains in housing starts and
manufacturing suggested that the economy was continuing its robust
expansion. ... Starts of new housing rose 1.3 percent in February, led by a
19.2 percent increase in construction of multifamily homes. Starts of
single-family houses fell 3.9 percent. Business at Philadelphia-area
factories expanded at an increased pace in March, as new orders surged, a
Federal Reserve report showed. ... And the Labor Department said first-time
claims for state unemployment benefits fell 19,000 to a seasonally adjusted
263,000 last week -- the lowest in 26 years. ... (Bloomberg News story in
New York Times, page C2).
__For months, market-watchers and analysts have been on the lookout for any
sign that inflation -- largely dormant for years -- may be stirring. But
the latest gauge, the February producer-price index, which measures prices
paid to the nation's farms, factories, and refineries, proved inconclusive.
Inflation hawks could cite the index's largest monthly advance since October
1990 as evidence that a broader resurgence may be on the horizon. ... On
the other hand, the report offers some reason for optimism. Excluding food
and energy, prices rose 0.3 percent for the month, with a 6.3 percent surge
in cigarette prices accounting for all of that increase. For the past 12
months, prices for core finished goods climbed just 1 percent, the lowest
year-over-year change since last November. ... The biggest inflation threat
may come from the elimination of many of the factors that have kept prices
fairly flat in recent years. ... The cost of imported goods declined
repeatedly in recent years, helping to deter American producers from raising
their prices. But import prices jumped 1.9 percent in February, their
sharpest gain in more than nine years. ... Separately, the Commerce
Department said that construction starts on new homes and apartments rose to
their fastest pace in 13 months in February, suggesting that the housing
industry remains resilient to the Fed's recent rate increases.. ... The
number of Americans filing first-time claims for unemployment benefits
plunged 19,000 to a 26-year low, offering further evidence that the job
market remains extremely tight. ... (Yochi J. Dreazen in Wall Street
Journal, page A2).
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