Wholesale Inflation Declined In August But Is Still Up 8.7% From Last Year

The latest data released by the Department of Labor on Wednesday (September 14) showed that wholesale inflation slowed in August, declining by 0.1%. It is the second month in a row in which the producer price index has decreased. While the slight decline is good news, the producer price index is still 8.7% higher than it was last year.

It is a sharp decline from the 9.8% rise in July and the lowest increase since August 2021.

Wholesale food costs remained flat in August after increasing by 1.3% last month, and wholesale goods prices fell by 1.2%. The reductions are due in part to lower gas prices, which have fallen by 12.7%, and final demand energy prices, which are 6% lower than last month.

"There is a divergence in headline and core inflation building, where headline is cooling, and core is heating up," Jamie Cox, managing partner of the Harris Financial Group, told Fox Business. "That's an odd phenomenon and likely influenced by the shift from goods to services post-pandemic."