US producer prices unexpectedly fell in July amid a drop in the cost of energy products, and core producer inflation appears to be on a downward trend.
The producer price index for final demand fell 0.5% last month after rising 1.0% in June, the Labor Department said on Thursday.
In the 12 months through July, the index increased 9.8%, from 11.3% in June.
There was a 1.8% drop in goods prices, after rising 2.3% in June. The cost of services rose 0.1%, after advancing 0.3% in June.
Economists polled by Reuters had forecast a 0.2% rise in the index in July and 10.4% from a year earlier.
The government said last Wednesday that consumer prices were unchanged in July amid falling gasoline prices.
Excluding the volatile food, energy and commercial services components, producer prices rose 0.2% in July. The so-called core index had increased by 0.3% in June.
In the 12 months through July, the core rise slowed to 5.8% from 6.4% in June.
The Federal Reserve is weighing whether to raise its benchmark lending rate, likely by another 50 or 0.75 percentage points at its next meeting on Sept. 2% target.
The US central bank has raised its interest rate by 2.25 points since March.
Source: CNN Brasil
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