FX.co ★ US Producer Prices Unexpectedly Fall

In August 2025, producer prices in the United States experienced an unexpected decline of 0.1% month-over-month. This follows a revised increase of 0.7% in July, significantly underperforming analysts' expectations of a 0.3% rise. This marks the first downturn in producer prices in four months. The primary factor was a 0.2% drop in service costs, the largest decline since April, driven by a notable 3.9% decrease in margins for machinery and vehicle wholesaling. Further reductions were observed in the costs associated with the wholesale of professional and commercial equipment, chemicals, furniture retailing, food and alcohol retailing, and data processing services. Conversely, the prices for goods saw a 0.1% increase, marking the fourth consecutive month of gains, primarily fueled by a 2.3% rise in tobacco product prices. In addition, there were increases in the indexes for beef and veal, processed poultry, printed circuit assemblies, and electric power. On an annual basis, producer prices increased by 2.6%, down from a downwardly revised rate of 3.1% in July and lower than the forecasted 3.3%. Core producer prices also saw a 0.1% decline, contrary to the anticipated 0.3% rise, with the annual core rate dropping more than expected to 2.8%.