Producer prices in the United States declined in May for the second time in three months, the latest sign that the inflation surge seen earlier this year might be waning.
The producer price index (PPI) fell by 0.2 percent last month, according to data released by the government on Thursday. This decrease surprised economists, who had forecast a 0.1 percent increase, according to a survey by Econoday.
So-called core-core prices, a measure that excludes the often-volatile food and energy prices as well as profit margins at wholesalers and retailers, was unchanged.
This decline in producer inflation follows a May report on consumer prices, which showed no increase for the first time in nearly two years. These recent inflation readings have encouraged those hoping the Federal Reserve might consider cutting interest rates as early as September.
The annual increase in producer prices eased to 2.2 percent in May, down from 2.3 percent in the previous month.
The year-over-year rise in core-core prices rose from 3.1 percent to 3.2 percent despite the month-over-month slowdown. This is due to weaker inflation numbers last year dropping out of the 12-month calculation.
Where the consumer price index captures what consumers pay for goods and services produced at home and abroad, the PPI is limited to domestic producers but includes prices paid by businesses and government.
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