U.S. producer prices fell in April, marking the second decline in three months, according to a new government report released Tuesday.
The Producer Price Index, or PPI, declined 0.1% in April after rising 0.7% in March, the Labor Department revealed. The PPI is the measure of wholesale inflation, or prices businesses (farms and factories) pay for their goods.
Aprils fall is unexpected for many analysts who were forecasting a 0.1% increase. Leading the decreases were falling energy and food prices, which respectively dropped 0.8% and 0.2%. The costs of meats, however, soared 5.1%.
Stripping out volatile food and energy costs, core producer prices rose 0.2% after two straight months of 0.1% increases.
Intermediate goods prices excluding food and energy rose 1.1% in April, which was the most since the 2.0% increase in July 2008. 30% of the advance can be attributed to higher prices for plastic resins and materials, which surged 11.4%, the Labor Department said.
Prices of core crude goods advanced 4.0% during the month.
Compared to April of last year, prices climbed 5.5%. Last month’s 12-month reading came in at 6%. The core annual wholesale inflation rate, however, increased by only 1.0% following a 0.9% pick up a month earlier.
The Consumer Price Index, or CPI, is considered the more closely watched indicator of inflation as is measures prices at the consumer level — it is also the data used as the core engine for the U.S. Inflation Calculator. The most recent reported 12-month inflation rate is standing at 2.3%. The CPI for April is schedule for release on Wednesday at 8:30 AM Eastern Time.