WASHINGTON (dpa-AFX) - Producer prices in the U.S. increased in line with economist estimates in the month of August, the Labor Department revealed in a report released on Thursday.
The Labor Department said its producer price index for final demand rose by 0.4 percent in August following a revised 0.1 percent uptick in July.
Economists had expected producer prices to climb by 0.4 percent compared to the unchanged reading originally reported for the previous month.
The report also said the annual rate of growth by producer prices surged to 5.4 in August from 4.8 percent in July. The annual rate of growth was expected to accelerate to 5.3 percent.
The monthly increase in producer prices largely reflected a rebound in energy prices, which spiked by 4.2 percent in August after tumbling by 1.8 percent in July.
The Labor Department also said prices for services crept up by 0.1 percent in August after rising by 0.2 percent in July, led by a 2.3 percent surge in prices for transportation and warehousing services.
Meanwhile, prices for trade services dipped by 0.2 percent during month and prices for other services came in unchanged.
The report said core producer prices, which exclude prices for food, energy and trade services, rose by 0.3 percent in August after climbing by 0.4 percent in July.
The annual rate of growth by core producer prices came in at 4.7 percent in August, unchanged from the previous month.
'Producer price inflation has been increasing since early 2023, but core PPI inflation was relatively stable until this year, when it pushed above 4% for the first time since the pandemic inflation bout of 2021-22,' said Chris Low, chief economist with FHN Financial.
'In the PPI, most of the core price pressure this year has been energy price passthrough in categories like airfares,' he added. 'With oil at new 2026 highs and diesel setting new record highs every day in September, this passthrough pressure is likely to continue for some time.'
On Friday, the Labor Department is scheduled to release its more closely watched report on consumer price inflation in the month of August.
Economists currently expect consumer prices to increase by 0.4 percent in August after inching up by 0.1 percent in July.
Core consumer prices, which exclude food and energy prices, are expected to rise by 0.2 percent for the second consecutive month.
The annual rate of consumer price growth is expected to come in unchanged at 3.4 percent, while the annual rate of core consumer price growth is expected to edge down to 2.4 percent in August from 2.5 percent in July.
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