EmailProducer prices fell 1.0% in May after declining 0.2% in April. The Briefing.com consensus expected PPI to fall 0.7%. The decline in producer prices was driven by a third consecutive drop in energy prices. Energy prices fell 4.3%, the largest decline since falling 4.6% in March 2009. Gasoline prices fell 8.9% and accounted for most of the drop. Food prices fell 0.6% in May, marking the largest decline since December 2011.
Excluding food and energy, core PPI increased 0.2% for the second consecutive month, which was in-line with the consensus estimate. A large portion of the increase in core prices was attributed to a 0.7% increase in pharmaceutical preparations. Price pressures down the manufacturing pipeline weakened as both core intermediate (-0.2%) and crude (-1.3%) prices fell in May.
