US Producer Prices in July Down 0.5% from Previous Month

[Asia Economy New York=Special Correspondent Joselgina] The producer price index (PPI) in the United States recorded a month-on-month decline for the first time in over two years.

The U.S. Department of Labor announced on the 11th (local time) that the July PPI fell by 0.5% compared to the previous month. This is the first time since April 2020 that the monthly growth rate turned negative. This is attributed to the recent decline in energy prices.

Compared to the same month last year, the July PPI rose by 9.8%, marking a single-digit increase for the first time since November last year (9.9%). The rate of increase also clearly slowed compared to the previous month (11.3%).

The market is interpreting this PPI slowdown as a sign that inflationary pressures have somewhat eased, considering that wholesale price increases are eventually passed on to consumer prices.

The Consumer Price Index (CPI) released the day before also showed a slowdown in the rate of increase. The July CPI rose 8.5% compared to the same month last year, a figure lower than the previous month’s (9.1%), which was the largest increase since November 1981. Additionally, the July CPI showed a 0% change compared to the previous month.