Wholesale inflation south of the border unexpectedly fell in August, recording its first drop in 1-1/2 years, as declines in the prices of food and a range of trade services offset an increase in the cost of energy products.
Figures released Wednesday by the U.S. Labor Department revealed the producer price index for final demand slipped 0.1% last month after being unchanged in July. August's fall in the PPI was the first since February 2017.
In the 12 months through August, the PPI rose 2.8% , slowing further after July's 3.3% increase.
Economists had forecast the PPI jumping 0.2% in August and advancing 3.2% year-on-year.
A key gauge of underlying producer price pressures that excludes food, energy and trade services edged up 0.1% last month. The so-called core PPI gained 0.3% in July.
In the 12 months through August, the core PPI increased 2.9% after rising 2.8% in July.
Despite the moderation in producer prices last month, overall inflation is steadily rising against the backdrop of a strong labour market and robust economy. The Trump administration's import tariffs on lumber, washing machines, solar panels, steel and aluminum, as well as a range of Chinese goods, are also expected to push up price pressures in the coming months.
