U.S. Producer Prices Unexpectedly Flat In July, Annual Growth Slows To 4.7%

(RTTNews) - A report released by the Labor Department on Thursday showed producer prices in the U.S. unexpectedly came in flat in the month of July.

The Labor Department said its producer price index for final demand was unchanged in July after edging down by a revised 0.1 percent in June.

Economists had expected producer prices to rise by 0.2 percent compared to the 0.3 percent dip originally reported for the previous month.

The report also said the annual rate of growth by producer prices slowed to 4.7 percent in July from 5.5 percent in June. The annual rate of growth was expected to slow to 4.9 percent.

The Labor Department said prices came in flat on a monthly basis as a 0.2 percent increase in prices for services and a 2.2 percent surge in prices for construction offset a 0.7 percent decrease in prices for goods.

The report showed an extended pullback in prices for energy, which tumbled by 3.1 percent in July. Prices for food also slid by 0.9 percent during the month.

Prices for transportation and warehousing services also slumped by 1.8 percent, while prices for trade services edged down by 0.1 percent and prices for other services climbed by 0.6 percent.

The Labor Department also said core producer prices, which exclude prices for food, energy and trade services, rose by 0.4 percent in July after inching up by 0.1 percent in June.

The annual rate of growth by core producer prices slowed to 4.7 percent in July from 5.0 percent in June.

A separate report released by the Labor Department on Wednesday showed consumer prices in the U.S. crept slightly higher in the month of July.

The Labor Department said consumer prices inched up by 0.1 percent in July after falling by 0.4 percent in June. The uptick in consumer prices matched economist estimates.

The report also said core consumer prices, which exclude food and energy prices, rose by 0.2 percent in July after coming in unchanged in June. The increase in core prices also matched expectations.

The annual rate of growth by consumer prices edged down to 3.4 percent in July from 3.5 percent in June, while the annual rate of growth by core consumer prices slipped to 2.5 percent in July from 2.6 percent in June. The modest slowdowns also came in line with estimates.