Producer price inflation moderated slightly in October, as expected, after accelerating faster than expected in September. The producer price index (PPI) rose 5% in October from a year earlier. That compares with a 5.2% increase in September. It was exactly in line with Investec’s forecast and a touch higher than the Trading Economics consensus of 4.9%. The main contributor to the annual rate was coke, petroleum, chemical, rubber and plastic products, which contributed 2.4 percentage points. Prices in that category were up 11.2% from a year earlier. Nonetheless, as with consumer inflation reported last week, smaller fuel price increases helped with the slowdown in producer inflation. Investec economist Kamilla Kaplan flagged that, as well as easing food inflation, in her weekly note, saying: "Additionally, food manufacturing, which holds the largest weighting in the PPI basket, is expected to continue reflecting decelerating rates of inflation, with the favourable grain supply outlo...
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