Inflationary pressures in the United States continued to decline in April as producer prices showed the weakest annual increase in over two years.
On Thursday, the Labor Department reported that the producer price index for final demand rose by 0.2% in the previous month. The PPI decline in March was revised down to 0.4% from the initial 0.5% reading.
The PPI rose 2.3% in the year up to April. After an increase of 2.7% in March, that was the lowest annual growth rate since January of 2021. The annual PPI rate is getting lower as last year’s big price gains are taken out of the equation.
Reuters’ survey of economists predicted a 0.3% month-over-month increase in the PPI and a 2.4% annual increase.
According to official data released on Wednesday, consumer price inflation fell below 5% year over year in April for the first time in two years.
Since March 2022, the Federal Reserve has increased its benchmark interest rate by 500 basis points, bringing it to a range of 5.00%-5.25%. Last week, the Fed gave indications that it would suspend its quickest monetary policy tightening campaign since the 1980s.
