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Wholesale inflation improved as energy prices fell last month - but relief may be temporary
CNN • • business
Key Points:
- The Producer Price Index (PPI) inflation slowed to 5.5% annually in June, down from 6% in May, driven largely by a 1.4% drop in goods prices and a 12% decline in gasoline prices.
- Monthly wholesale prices fell 0.3% in June, a reversal from a 0.6% increase in May, with core PPI excluding food and energy also slowing to 4.6% from 4.9%.
- Despite the June relief from lower energy costs, renewed conflict in the Middle East threatens to push oil prices and inflation higher in the near future.
- Federal Reserve Chairman Kevin Warsh cautioned against overinterpreting the positive inflation data, emphasizing it as only one data point amid ongoing economic uncertainties.
- Rising semiconductor chip prices, fueled by increased demand for AI computing capacity, contributed to higher costs in computers and related equipment, with a 2.5% monthly increase in that index.
