US wholesale inflation continues to move lower in May
Factory gate inflation in the States surprised to the upside last month, boosted by increases in the cost of food and energy, but the underlying trend continued to point downwards.
According to the Department of Labor, final demand prices rose at a 0.4% month-on-month clip (consensus: 0.1%), but excluding food, energy and trade prices were 0.4% lower than a year ago, against a 0.3% drop in April.
On the goods side of the equation, when measured against April, food prices jumped by 0.6% and energy prices by 4.5%.
Meanwhile, prices for services drifted lower by 0.2%, weighed down by a 0.8% fall in the trade services component, which tracks margins in retail and wholesale.
Prices for transportation and warehousing meanwhile rose by 1.5% while those for "other" services were unchanged on the month.
Ian Shepherdson at Pantheon Macroeconomics highlighted the slide in prices, telling clients: "Overall, though, core PPI inflation is falling, hitting -0.3% y/y when the trade services component is stripped out, down from 1.5% in February."