Wholesale Services Price Index, fourth quarter 2017
The Wholesale Services Price Index (WSPI) was up 0.9% in the fourth quarter, following a 0.6% decline in the third quarter. Of the eight subsectors, five posted margin gains and three were down.
The increase in the WSPI in the fourth quarter was led by petroleum and petroleum product merchant wholesalers (+5.6%), as margins for this subsector were up following a 13.8% decline in the third quarter. This margin gain occurred in the context of reduced global crude oil output following the November 2017 decision by the Organization of the Petroleum Exporting Countries (OPEC) to extend production limits to the end of 2018.
Higher margins for machinery, equipment and supplies merchant wholesalers (+1.1%), primarily due to computer, computer peripheral and pre-packaged software merchant wholesalers, also contributed to the increase in the WSPI in the fourth quarter.
To a lesser extent, margins were also up for food, beverage and tobacco (+1.1%), miscellaneous (+1.0%) and personal and household goods (+0.5%) merchant wholesalers.
Moderating the quarterly increase in the WSPI was motor vehicle and motor vehicle parts and accessories (-0.9%), as a result of lower margins on truck, truck tractor and bus merchant wholesalers.
Lower margins were also reported by farm product merchant wholesalers (-2.3%), with widespread declines across all industries in the subsector.
Margins for building material and supplies merchant wholesalers (-0.2%) also fell.
The WSPI rose 4.5% in the fourth quarter compared with the same quarter in 2016, as margins were up for six of the eight subsectors. This was the 17th consecutive year-over-year increase.
Petroleum and petroleum products merchant wholesalers (+38.7%) posted the largest year-over-year margin gain. Year-over-year margin increases were recorded in every quarter of 2017 for the petroleum and petroleum products merchant wholesalers subsector.
Margins were also up for building material and supplies (+4.5%), personal and household goods (+3.4%), machinery, equipment and supplies (+3.1%), miscellaneous (+3.0%) and food, beverage and tobacco (+1.5%) merchant wholesalers.
Farm products merchant wholesalers (-9.7%) posted the largest year-over-year margin decline in the fourth quarter. Motor vehicle and motor vehicle parts and accessories merchant wholesalers (-0.8%) were also down.
Note to readers
The Wholesale Services Price Index (WSPI) represents the change in the price of the wholesale service. The price of the wholesale service is defined as the margin price, which is the difference between the average purchase price and the average selling price of the wholesale product being priced. The WSPI is not a wholesale selling price index.
With each release, data for the previous quarter may have been revised. The series are also subject to an annual revision with the release of second quarter data of the following reference year. The indexes are not seasonally adjusted. Data are available at the Canada level only.
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