US producer prices unexpectedly fell in August, government data showed Wednesday, driven in part by a pullback in energy and trade, and prompting President Donald Trump to renew calls for lower interest rates.
The producer price index (PPI) dipped 0.1 percent on a month-on-month basis, according to Department of Labor data -- when analysts had expected a 0.3-percent increase.
The last such monthly decrease was seen in April, and compared with a year ago, PPI was up 2.6 percent, cooling from July's figure as well.
"Just out: No Inflation!!!" Trump wrote on his Truth Social platform shortly after the data was published.
He reiterated his calls for Federal Reserve Chair Jerome Powell to lower rates "right now," calling the central bank chief "a total disaster."
The numbers come as policymakers try to gauge the effects of Trump's sweeping tariffs on prices, and were reported just a week before the Fed is set to hold its next policy meeting on interest rates.
Stubbornly elevated inflation could make it tougher for the Fed to cut rates.
But relatively benign inflation, alongside a weakening labor market, has meant that traders widely expect the central bank to adopt a cut of 25 basis points this month.
In recent months, Trump has been ramping up pressure on the independent central bank to slash rates, taking aim at Powell repeatedly for not doing so more quickly.
A decline in services prices was a key factor behind the PPI drop in August, with margins for trade services in particular falling, said the Labor Department.
Excluding food, energy and trade services, PPI rose 0.3 percent from a month ago, and 2.8 percent from a year ago -- the largest 12-month advance since March.
"The latest PPI data pose no obstacle to a Fed rate cut next week," said Carl Weinberg, chief economist at High Frequency Economics.
He added that the August PPI report "paints a much less scary picture of prices of goods 'in the pipeline' than the July report."
Looking ahead, analysts will be eyeing the key consumer price index report due on Thursday.
The producer price index (PPI) dipped 0.1 percent on a month-on-month basis, according to Department of Labor data -- when analysts had expected a 0.3-percent increase.
The last such monthly decrease was seen in April, and compared with a year ago, PPI was up 2.6 percent, cooling from July's figure as well.
"Just out: No Inflation!!!" Trump wrote on his Truth Social platform shortly after the data was published.
He reiterated his calls for Federal Reserve Chair Jerome Powell to lower rates "right now," calling the central bank chief "a total disaster."
The numbers come as policymakers try to gauge the effects of Trump's sweeping tariffs on prices, and were reported just a week before the Fed is set to hold its next policy meeting on interest rates.
Stubbornly elevated inflation could make it tougher for the Fed to cut rates.
But relatively benign inflation, alongside a weakening labor market, has meant that traders widely expect the central bank to adopt a cut of 25 basis points this month.
In recent months, Trump has been ramping up pressure on the independent central bank to slash rates, taking aim at Powell repeatedly for not doing so more quickly.
A decline in services prices was a key factor behind the PPI drop in August, with margins for trade services in particular falling, said the Labor Department.
Excluding food, energy and trade services, PPI rose 0.3 percent from a month ago, and 2.8 percent from a year ago -- the largest 12-month advance since March.
"The latest PPI data pose no obstacle to a Fed rate cut next week," said Carl Weinberg, chief economist at High Frequency Economics.
He added that the August PPI report "paints a much less scary picture of prices of goods 'in the pipeline' than the July report."
Looking ahead, analysts will be eyeing the key consumer price index report due on Thursday.
You may also like
EastEnders fans predict death of fan favourite amid dark blackmail storyline
Hot weather maps show exact date 23C heat returns to England - 22 hottest counties
Mangal Kavya and Puthi Panchali festival begins at Bonkumari Nat Mandir
Nepal unrest: Time for India to introspect and act in good faith
Gregg Wallace rejected by huge TV show after decision to sue BBC revealed
