U.S. Producer Prices Rose in June

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U.S. Producer Prices Rose in June

WASHINGTON—A gauge of U.S. business prices rose in June, the latest sign that inflation pressures in the economy are firming. The producer-price index, a measure of the prices businesses receive for their goods and services, rose a seasonally adjusted 0.3% in June from a month earlier , the Labor Department said Wednesday. When excluding the often-volatile food and energy categories, prices were also up 0.3% in June from the prior month. Prices excluding food, energy and trade services increased 0.3% on the month, as well. Economists surveyed by The Wall Street Journal had expected a 0.2% increase in overall prices and a 0.2% increase in prices excluding food and energy. Trucking freight prices helped drive overall costs higher, rising 1.3% in June, the largest increase in the category for records dating back to July 2009. From a year earlier, overall prices climbed 3.4% in June, the largest annual rise since November 2011. Prices excluding food and energy increased 2.8%. Prices excluding food, energy and trade services were up 2.7%. In the longer term, annual gains in the headline index have risen since the beginning of 2016. Rising oil prices and improved global demand have helped push the index higher. The producer-prices measure usually follows the same trends as other broad inflation gauges, though it doesn’t always translate into what consumers pay. Signs of building inflation pressures have emerged within other recent reports. The consumer-price index rose 2.8% in May from the prior year , its strongest annual reading since February 2012 when inflation was 2.9%, the Labor Department said last month. The Labor Department will release June CPI data on Thursday, and economists surveyed by The Wall Street Journal expect a 2.9% annual increase. Federal Reserve officials closely monitor inflation readings as they debate how quickly to raise interest rates. The Fed raised its benchmark federal-funds rate in June by a quarter percentage point, to a range between 1.75% and 2% , the second such increase this year. Officials last month penciled in a total of four increases for 2018, up from a projection of three at their March meeting. Write to Sarah Chaney at sarah.chaney@wsj.com and Sharon Nunn at sharon.nunn@wsj.com