U.S. Producer Prices Remain Flat in June, Easing Inflation Concerns

U.S. wholesale prices were unchanged in June, according to seasonally adjusted data from the Bureau of Labor Statistics released Wednesday, signaling subdued inflationary pressure despite ongoing tariffs. Economists surveyed by Dow Jones had anticipated a 0.2% rise in the producer price index (PPI), but the report showed no change for both headline and core measures.

Final demand goods prices increased by 0.3%, led by a 0.8% gain in tariff-sensitive communication equipment, while services prices fell by 0.1%. Core goods prices also rose 0.3%. The PPI figure for May was revised upward from a 0.1% to a 0.3% increase, marking the largest monthly gain in goods prices since February.

On an annual basis, the headline PPI rose 2.3%, down from 2.7% in May and the lowest since September 2024. Core PPI increased 2.6% year-over-year, the smallest rise since July 2024. These figures follow the consumer price index report, which showed a 0.3% monthly increase and a 2.7% annual rate for headline inflation, with core inflation at 2.9%.

All major inflation measures remain above the Federal Reserve's 2% target. President Donald Trump reiterated his call for the Fed to lower interest rates, but market expectations indicate little chance of a rate cut at the upcoming July meeting. Federal Reserve officials have stated they are monitoring the effects of tariffs and believe the economy is strong enough to delay changes to monetary policy.

The PPI report also noted a 0.6% rise in energy prices and a 0.2% increase in food prices for June, while chicken egg prices dropped sharply by 21.8%. Following the release, stock futures rose and Treasury yields declined.