U.S. wholesale inflation fall 0.1% in July, first decline in almost a year

• August 10, 2017
• realestate
• Announcements, Business & Markets, Real Estate, Real Estate Finance, Updates

Lack of price pressure in the pipeline saw U.S. wholesale prices declined in July for the first time in almost a year, further evidence of soft inflation that is bedeviling the Federal Reserve.

The producer price index fell 0.1 in July, the Labor Department said Thursday, the first drop since last August. The core rate, which excludes volatile categories of food, energy and trade, was flat in the month.

Economists surveyed were expecting a small gain of 0.1% in the producer price index. Price pressures were not evident in any major category. The price of goods dropped 0.1% last month. Wholesale energy prices sank 0.3% and food prices were flat. The cost of services fell 0.2%.

Over the past year overall producer prices decelerated to a 1.9% annual rate, and have steadily dipped from a high of 2.5% in April. The July annual rate is the lowest since January.
Core wholesale prices have risen 1.9% in the same span, down from a 2% rate in June.

The slowdown has surprised the Fed and prompted some senior central-bank officials to question whether further rate increases are merited in an environment of stubbornly low consumer prices and inflation.