The Producer Price Index year-over-year inflation declined from 3.4 % to 3.3 %.

Analyst Opinion of Producer Prices

The Producer Price Index declined year-over-year. Food and energy prices did moderate. Here is what the BLS said in part:

Final demand goods: The index for final demand goods inched up 0.1 percent in July, the same as in June. The July advance in prices for final demand goods can be traced to a 0.3-percent rise in the index for final demand goods less foods and energy. In contrast, prices for final demand energy fell 0.5 percent, and the index for final demand foods decreased 0.1 percent.

Final demand services: Prices for final demand services edged down 0.1 percent in July, the first decline since falling 0.2 percent in December 2017. The July decrease is attributable to the index for final demand trade services, which moved down 0.8 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.) In contrast, prices for final demand services less trade, transportation, and warehousing and the index for final demand transportation and warehousing services advanced 0.3 percent.

The PPI represents inflation pressure (or lack thereof) that migrates into consumer price.

The market had been expecting (from Nasdaq / Econoday):

month over month change Consensus Range Consensus Actual PPI-Final Demand (PPI-FD) 0.1 % to 0.3 % +0.3 % +0.0 % PPI-FD less food & energy (core PPI) 0.2 % to 0.3 % +0.3 % +0.1 % PPI-FD less food, energy & trade services 0.2 % to 0.3 % +0.2 % +0.3 %

The producer price inflation breakdown:

category month-over-month change year-over-year change final demand goods +0.1 %   final demand services -0.1%   total final demand +0.0 % +3.3 % processed goods for intermediate demand +0.0 % +6.8 % unprocessed goods for intermediate demand +2.7 % +8.2 % services for intermediate demand +0.2 % +3.0 %
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