A key inflation gauge showed price hikes slowed last month. But economic jitters remain
The Producer Price Index, a measurement of average price changes seen by producers and manufacturers, was 2.2% for the 12 months ended in July, a stark pullback from the 2.7% increase registered in June, according to Bureau of Labor Statistics data released Tuesday.
On a monthly basis, prices rose 0.1%, a slower pace than the 0.2% increase seen in June.
Economists had expected that prices would increase 0.2% on a monthly basis and slow to 2.3% annually, according to FactSet estimates.
PPI serves as a potential bellwether for retail-level inflation in the months ahead. On Wednesday, the BLS will release the Consumer Price Index for July, providing a critical look at how prices are changing for consumers in their everyday lives.
This story is developing and will be updated.
The unexpected deceleration in the PPI could potentially impact businesses dependent on raw materials, as higher costs often translate into increased prices for consumers. The economy's overall growth might also be influenced by this downturn in the producer price index.
