U.S. producer price. showed a surprising reading when it suddenly fell in July amid falling costs for energy products. This indirectly indicates that core producer inflation appears to be on a downward trend.
The producer price index for final demand declined 0.5% last month after rising 1.0% in June, the Labor Department reported on Thursday. In the 12 months to July, the IHPR rose 9.8% after rising 11.3% in June.
There was a decrease of 1.8% in the price of goods. Where it has obtained a 2.3% increase in June. The cost of services rose 0.1% after rising 0.3% in June.
Economists polled by Reuters had forecast PPI to rise 0.2% in July and rise 10.4% on a year-on-year basis.
The government on Wednesday reported consumer prices were unchanged in July, driven by lower petrol prices after a spike earlier this year.
Excluding the volatile food, energy and services components of trade, producer prices rose 0.2% in July. The so-called core HIPR rose 0.3% in June. In the 12 months to July, core PPI rose 5.8% after rising 6.4% in June.
The Federal Reserve is mulling whether to raise its benchmark overnight lending rate possibly by another 50 or 75 basis points at its next policy meeting on September 20-21, as the Fed is faced with mixed data where inflation is starting to slow.
U.S. central bank has raised its policy rate by 225 basis points since March.
