US producer prices fall on energy slide

The Producer Price Index for final demand declined 0.3% in June 2026 on a seasonally adjusted basis, reversing strong increases in the prior two months. Despite the monthly drop, producer prices were 5.5% higher for the 12 months ended in June on an unadjusted basis. The data indicate that overall wholesale price pressures eased in June even as the year-over-year rate of inflation remained elevated.

The June outcome followed upward moves of 0.6% in May and 1.1% in April on a seasonally adjusted basis. The May reading had initially been reported as a 1.1% increase but was later revised down to a 0.6% gain, softening the recent profile of wholesale inflation.

The overall decline in June was led by prices for final demand goods, which fell 1.4% for the month. This contrasted with final demand services, where prices rose 0.2%, underscoring that most of the disinflationary impulse came from the goods side of the economy.

Within goods, energy played a central role. Gasoline prices tumbled about 12% in June and accounted for roughly two-thirds of the overall monthly decrease in the PPI. Broader energy prices were also weak, and final demand food prices declined 0.6%, contributing to the 1.4% drop in goods prices.

Further back in the production pipeline, prices for unprocessed goods for intermediate demand also weakened. A key contributor was crude petroleum, where prices fell 12.1% in June, adding to the downward pressure on upstream cost measures.

Excluding more volatile components, underlying wholesale inflation showed a smaller but still positive increase. The index for final demand less foods, energy, and trade services rose 0.1% in June, following a 0.8% increase in May. This suggests that while headline inflation pressures eased on the back of energy and some goods categories, core-related producer prices continued to edge higher.

The differing movements between headline and core-related measures highlight the role of volatile components in monthly inflation readings. June’s data show that energy and gasoline in particular were pivotal in pulling the overall index lower, even as services prices and core components maintained upward momentum.