US July PPI Flat as Energy Prices Dip, Missing Forecasts on All Measures

U.S. producer prices were unchanged in July, the Labor Department reported, falling short of the Dow Jones consensus estimate of a 0.2% monthly gain and reversing course after a 0.1% decline in June. On a year-over-year basis, the producer-price index rose 4.7%, below the 4.9% estimate. Core PPI, which strips out food and energy, rose 0.2% month-over-month and 4.2% year-over-year, both at or below expectations of 0.3% and 4.2% respectively.

Lower energy prices were a key factor containing wholesale inflation. The softer-than-expected reading, coming alongside recent subdued consumer inflation data, may ease pressure on the Federal Reserve over near-term rate policy. Markets responded positively, with the Dow Jones Industrial Average gaining more than 100 points following the release.