U.S. producer-price data for June pointed to softer underlying inflation than expected, a reading that may give the Federal Reserve more room to hold off on additional rate hikes. According to the figures cited by BlockBeats, core PPI, which strips out food and energy, rose 4.7% from a year earlier and 0.2% from the previous month, while headline PPI slowed to a 5.5% annual increase. Energy costs fell 6.4% during the month, helping ease price pressure, and transportation and warehousing prices also moved lower. Food prices, meanwhile, posted their first decline in three months. The report follows macro data released Tuesday showing June CPI was also milder than expected. Even so, the picture remains unsettled. The report said freight rates stayed elevated because of higher fuel costs and a driver shortage tied to tighter immigration policies under the Trump administration. It also noted that food prices in the U.S. have generally kept rising this year under pressure from severe weather, war and tariffs, while renewed escalation in the Middle East could limit how long the current relief lasts.
Underlying U.S. producer-price inflation for June came in weaker than expected, suggesting the impact from the Iran war remained at least partly contained, according to BlockBeats on July 15.
Data showed core producer price index (PPI), which excludes food and energy, rose 4.7% year over year and 0.2% month over month. Headline PPI growth slowed to 5.5% on an annual basis.
Lower energy costs helped ease inflation pressure during the month. Energy prices fell 6.4% in June, while transportation and warehousing prices also declined. Food prices, meanwhile, recorded their first drop in three months.
The figures came after macro data released Tuesday showed June consumer price index (CPI) was also softer than expected. Taken together, the two readings may give the Federal Reserve more room to delay further rate hikes.
That window may not last long. With tensions in the Middle East escalating again, the inflation outlook remains uncertain. The report also said freight rates stayed high because of rising fuel costs and a shortage of drivers linked to tighter immigration policies under the Trump administration. At the same time, U.S. food prices have broadly continued to rise this year as severe weather, war and tariffs combined to keep pressure on costs.
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