WASHINGTON – Falling gasoline costs lowered the prices that U.S. companies received for their goods and services last month, keeping overall inflation in check.
The producer price index rose 0.1 percent in July, following a 0.4 percent gain in June, the Labor Department said Friday. The index measures the cost of goods and services before they reach the consumer.
Wholesale gas prices fell 2.1 percent, after jumping 6.4 percent in June. The cost of pharmaceuticals, pickup trucks and rail and truck shipping services rose, while the cost of vegetables, jewelry and natural gas fell.
Excluding the volatile categories of food, energy and retailer and wholesaler profit margins, prices moved up 0.2 percent.
In the past 12 months, producer prices have risen just 1.7 percent, slightly below the Federal Reserve’s target.
Wholesale prices jumped 0.5 percent in April, led by a big increase in food costs. That raised concerns among some economists that inflation could accelerate. But price changes since then have been mostly tame.
Consumer prices have tended to track the costs for producers. They rose 0.3 percent in June, mostly because of higher pump prices. Consumer prices rose 2.1 percent in June compared with the year prior.
The Fed targets inflation at about 2 percent as a guard against deflation, which could drag down wages and spark another recession.