Wholesale prices fell 0.3% in June on gasoline drop, PPI data shows
15 reported
Wholesale prices unexpectedly declined in June, driven by a sharp drop in gasoline costs, according to a Bureau of Labor Statistics report released Wednesday. The producer price index fell a seasonally adjusted 0.3% for the month, compared with the Dow Jones consensus estimate for no change. On an annual basis, the index indicated a 5.5% inflation rate. The May reading was revised sharply lower from an initially reported increase of 1.1% to 0.6%. Excluding food and energy, core PPI rose 0.2%, against the outlook for a 0.3% increase. The core PPI less trade services rose 0.1% and was up 5.1% from a year ago. Goods prices posted a 1.4% monthly decline, the biggest drop since July 2022, as energy slumped 6.4% and final demand food prices fell 0.6%. Within goods, gasoline tumbled 12%, accounting for about two-thirds of the monthly decrease. Services prices rose 0.2%, boosted by a 0.4% increase in trade services.
What’s reported
The producer price index fell 0.3% in June, seasonally adjusted.
The Dow Jones consensus estimate was for no change.
Annual PPI inflation stood at 5.5%.
May's PPI was revised from an initial 1.1% increase to 0.6%.
Core PPI (excluding food and energy) rose 0.2%, below the 0.3% estimate.
Core PPI less trade services rose 0.1%, up 5.1% year-over-year.
Goods prices fell 1.4% monthly, the largest drop since July 2022.
Energy prices fell 6.4%; food prices fell 0.6%.
Gasoline prices dropped 12%, accounting for about two-thirds of the monthly decline.
Services prices rose 0.2%, with trade services up 0.4%.
The consumer price index fell 0.4% in June, annual rate at 3.5%.
Core CPI slipped to 2.6% after prices were unchanged for the month.
The Fed's preferred inflation gauge, the PCE index, showed headline inflation of 4.1% and core at 3.4% for May.
Markets expect the Fed to approve an interest rate hike as soon as September.
Fed Chairman Kevin Warsh told House lawmakers the June decline did not represent a "mission accomplished" moment for inflation.
Key figures
Chris Rupkey, chief economist at Fwdbonds
Kevin Warsh, Fed Chairman
Sources: CNBC
