The Labor Department has unveiled data indicating a slight increase in U.S. producer prices for June, exceeding economist predictions. This comes on the heels of unexpectedly mild consumer price inflation figures released a day prior.
According to the report, the Producer Price Index (PPI) for final demand rose by 0.2% in June, following a revised flat reading in May. Economists had anticipated a minor increase of 0.1%, contrasting with the initially reported 0.2% decline for May.
Additionally, the annual rate of producer price growth increased to 2.6% in June, up from an upwardly revised 2.4% in May. This surpassed expectations, which had economists predicting a rise to 2.3%.
The monthly uptick in producer prices is primarily attributed to a rise in service prices, which went up by 0.6% in June after a 0.3% increase in May. Particularly, trade service prices surged by 1.9% in June following a 0.7% rise in May.
The report also indicated that prices for services excluding trade, transportation, and warehousing edged up by 0.1%, while transportation and warehousing services prices declined by 0.4%.
When stripping out food, energy, and trade services, core producer prices remained stable in June after a 0.2% rise in May. However, the annual growth rate for core producer prices decelerated to 3.1% in June from a revised 3.3% in May.
In a separate report released on Thursday, the Labor Department detailed a slight and unexpected dip in consumer prices for June. The Consumer Price Index (CPI) slipped by 0.1% in June, following an unchanged reading for May, contradicting economists' forecasts of a 0.1% rise.
This decline in consumer prices was mainly driven by another significant drop in gasoline prices, which offset the ongoing increase in shelter costs. Excluding food and energy, core consumer prices inched up by 0.1% in June, following a 0.2% rise in May, while projections had anticipated another 0.2% increase.
The report also highlighted a slowdown in the annual rate of consumer price growth to 3.0% in June from 3.3% in May, against an expected deceleration to 3.1%. The annual rate of core consumer price growth also eased to 3.3% from 3.4%, contrary to expectations of a stable growth rate.
