US Producer Prices Unexpectedly Fall

Producer prices in the US increased 0.4% mom in August 2026, following an upwardly revised 0.1% rise in July and in line with expectations. It is the biggest increase in three months, led by a 1.1% jump in prices of goods after declines in each of the previous two months, with diesel fuel jumping 24.1%. Prices for gasoline, jet fuel, home heating oil, candy and nuts, and tobacco products also advanced. In contrast, prices for residential electric power fell 0.5%. Meanwhile, services cost edged up 0.1%, led by a 2% rise in prices for truck transportation of freight. Increases were also seen for airline passenger services, legal services, hospital inpatient care, and automobiles retailing. Year-on-year, producer inflation accelerated to 5.4% from 4.8%, slightly above forecasts of 5.3%. Excluding food and energy, producer prices increased 0.2% on the month and 4.6% on the year, compared to 0.3% and 4.3% respectively in the previous month and forecasts of 0.3% and 4.6% respectively.

US producer prices are expected to rise 0.4% month-over-month in August 2026, marking the strongest increase in three months after remaining unchanged in July, signalling a renewed acceleration in producer-level inflation. Core producer prices, which exclude the more volatile food and energy components, are forecast to rise 0.3% mom, accelerating from the 0.2% increase recorded in July. On an annual basis, headline PPI inflation is expected to accelerate to 5.3%, up from 4.7% in July, while core producer inflation is projected to increase to 4.6% from 4.2%.

US producer prices were unchanged in July 2026, following a revised 0.1% fall in June and compared with market expectations of a 0.2% gain. A 0.2% increase in the index for services and a 2.2% advance in prices for construction offset a 0.7% decrease in the index for goods. Services prices rose at a slower pace than in June (0.2% vs 0.5%), while portfolio management costs jumped 6.5%, contributing significantly to the increase. By contrast, transportation and warehousing services fell 1.8%. Goods prices declined for a second consecutive month (-0.7% vs -1.4%), largely due to a 3.1% drop in energy prices, including a 5.7% plunge in gasoline prices. Food prices also fell 0.9% (vs -0.5%), while prices for goods excluding food and energy edged up 0.1% (vs 0.2%). Year-on-year, producer prices increased 4.7%, well below 5.5% in June and forecasts of 4.9%. Meanwhile, core producer prices rose 0.2%, below forecasts of 0.3% and the annual core rate came in at 4.2%, in line with expectations.