BLS DAILY REPORT, MONDAY, JUNE 12, 2000
__The producer price index for finished goods showed no change in May from
the previous month, as lower food and energy prices helped to offset higher
capital goods and auto prices, BLS reports. Accordingly, the core PPI,
which excludes volatile food and energy prices, rose 0.2 percent. "While
the core PPI is up slightly more than expected, the financial markets should
be relieved that pipeline inflationary pressures appear to be diminishing,"
says a first Union vice president and economist. Over the year ended in
May, the core PPI is up a moderate 1.4 percent while the overall PPI is up
3.4 percent, mainly due to energy prices which have risen 18.1 percent in
the last 12 months. ... (Daily Labor Report, page D-1).
__Producer prices for finished goods held steady in May, as falling costs
for energy products and food items more than offset increased prices for
cars, paper products, and books. The flat May reading for the producer
price index, which measures inflation pressures before they reach the
consumer, followed a 0.3 percent decline in April, which reflected a sharp
decline in the costs of energy. May's performance surprised analysts, who
were predicting that a rebound in energy prices would push the index up by
0.3 percent. ... (Washington Post, June 10, page E1; New York Times, June
10, page B3).
__A mixed report on wholesale prices leave the inflation picture murky, as
the Federal Reserve weighs another increase in interest rates. A speech by
Fed Chairman Greenspan to a New York business group tomorrow and the release
of May's consumer price index Wednesday could give a clearer focus on what
action the central bank will take at its meeting this month. ... (Wall
Street Journal, page A4).
Employers want to recruit people with skills in specific up-to-the-minute
software, networking, or the Web -- desperately so. But they don't seem to
be clamoring for college degrees, says Clifford Adelman, a senior research
analyst of the Education Department. Adelman's research opens a window on a
flourishing but hazy "parallel universe" outside the college realm, filled
with students who are studying how to operate Microsoft computer software or
Cisco Systems network switches or Oracle databases through courses designed
by these and other technology companies or industry groups. ... Adelman
calculates that as many as 1.6 million people worldwide have passed
certification tests in these technology disciplines last year -- equal to a
year's output of bachelor's and associate degrees in the U.S. ... Instead
of a diploma, students must pass challenging certification programs designed
by the technology companies. ... "Content counts," says Adelman. "You
can't fake it." However, students who make it through and pass the
certification have a ticket into the tech world. ... (Peter Behr in
Business Section of Washington Post, page 7).
The new high-tech global economy that is pumping up employment and home
ownership in most U.S. cities is also creating "staggering jumps" in home
prices and raising rents more than 1-l/2 times faster than the rate of
inflation, according to a new study by the Department of Housing and Urban
Development. The report, a first-ever compilation of the leading high-tech
markets in the country, shows that home prices went up more than twice as
fast as inflation in the past 3 years. In the 10 top markets, the cost of
buying a house since 1995 rose more than 18 percent in seven of the areas
and more than 20 percent in three of them. ... (Washington Post, page
A1)_____The nation's expanding economy has produced an unintended downside:
Rapidly increasing housing costs are denying may working-class wage earners
an affordable place to live, especially in urban areas. ... (New York
Times, page A20).
The Wall Street Journal's "Tracking the Economy" feature (page A2) forecasts
that the May CPI, due out Wednesday, will be up 0.2 percent, after being
unchanged in April, and the core CPI will also be up by 0.2 percent, the
same as in April, according to the Thomson Global Forecast.
DUE OUT TOMORROW: Mass Layoffs in April 2000
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