Producer prices in the U.S. unexpectedly saw a modest decrease in the month of August, according to a report released by the Labor Department on Wednesday.
The Labor Department said its producer price index for final demand edged down by 0.1 percent in August after coming in unchanged in July. Economists had expected prices to rise by 0.2 percent.
The unexpected drop in producer prices came as prices for final demand services dipped by 0.1 percent in August, matching the decrease seen in the previous month.
Over 80 percent of the decrease in prices for final demand services can be traced to margins for machinery and equipment wholesaling, which tumbled by 1.7 percent.
The indexes for health, beauty, and optical goods retailing, application software publishing, airline passenger services, and hospital outpatient care also fell, while prices for loan services jumped by 3.0 percent.
Meanwhile, the Labor Department said the index for final demand goods was unchanged in August after increasing in each of the prior three months.
Excluding food and energy prices, core producer prices still edged down by 0.1 percent in August following a 0.1 percent uptick in July. Core prices had been expected to increase by 0.2 percent.
Producer prices in August were up by 2.8 percent compared to the same month a year ago, reflecting a slowdown from the 3.3 percent increase in July.
Core prices were up by 2.3 percent year-over-year in August compared to the 2.7 percent jump in the previous month.
On Thursday, the Labor Department is scheduled to release a separate report on consumer price inflation in the month of August.
Consumer prices are expected to rise by 0.3 percent in August after edging up by 0.2 percent in July. Core consumer prices are expected to tick up by 0.2 percent.