Australia Q4 PPI Falls 0.4% On Quarter

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Producer prices for Stage 3 commodities in Australia were weaker than expected in the fourth quarter of 2009, the Australian Bureau of Statistics said on Monday, checking in lower by 0.4 percent compared to the previous quarter.

That compared to analyst expectations for a 0.2 percent increase following a 0.1 percent gain in the third quarter.

On an annual basis, producer prices fell 1.5 percent versus expectations for a 0.9 percent decline after the 0.2 percent increase in the previous three months.

The decline was mainly due to price decreases in petroleum refining (-6.9 percent), electronic equipment manufacturing (-9.1 percent) and industrial machinery and equipment manufacturing (-2.5 percent).

The decline was partially offset by price increases in other agriculture (11.2 percent) and building construction (0.3 percent).

Stage 2 commodities were down 0.9 percent on quarter and 6.5 percent on year. This was mainly due to price decreases in grain, sheep, beef and dairy cattle farming (-7.2 percent), iron and steel manufacturing (-6.6 percent) and petroleum refining (-3.6 percent).

The losses were partially offset by price increases in oil and gas extraction (3.0 percent), metal ore mining (4.0 percent) and electricity, gas and water supply (1.8 percent).

Stage 1 commodities were down 0.8 percent on quarter and 8.4 percent on year mainly due to price decreases in iron and steel manufacturing (-6.7 percent), grain, sheep, beef and dairy cattle farming (-6.2 percent), basic chemical manufacturing (-5.1 percent) and petroleum refining (-3.4 percent).

The losses were partially offset by price increases in oil and gas extraction (3.0 percent), electricity, gas and water supply (1.9 percent) and services to transport (4.5 percent).

The Australian dollar edged lower against its major opponents immediately following the release of the data, but rebounded slightly shortly thereafter. Currently, the Aussie is quoted at 0.905 against the greenback, 81.4 versus the yen and 1.566 against the euro.

(Market News Provided by RTTNews)