US August Wholesale Prices Rise 0.2% Month-on-Month, Meeting Market Expectations

Supporting the Trend of Inflation Slowdown

The U.S. wholesale price index, the Producer Price Index (PPI), matched market expectations last month, supporting the recent trend of slowing inflation.

According to the U.S. Department of Labor on the 12th (local time), the August PPI rose 0.2% month-over-month. This was in line with the Dow Jones experts' forecast (0.2%). It was a slight increase compared to July (0%).

The PPI rose at an annual rate of 1.7% over the past 12 months, significantly easing from 2.1% in July.

The core PPI, which excludes the volatile food and energy prices to show the underlying trend of inflation, increased by 0.3% in August compared to the previous month. This exceeded both the expert forecast (0.2%) and July's figure (a 0.2% decline).

The core PPI rose 2.4% year-over-year. Although this was higher than July's figure (2.3%), it was below the expert forecast (2.5%).

The wholesale price index, PPI, is considered a leading indicator of retail prices as it affects the Consumer Price Index (CPI) with a time lag. Since May, the month-over-month increase in PPI has remained between 0% and 0.2%, supporting the trend of easing inflation.

The U.S. CPI for August, released the previous day, rose 2.5% year-over-year. It continued a five-month streak of deceleration, marking the lowest level in three years and six months since February 2021.