U.S. producer prices inched up December as a rise in the price of goods was offset by weakness in companies, the latest indication of tame inflation pressures that might permit the Federal Reserve to maintain rates of interest unchanged this year.
The report from the Labor Division Wednesday came in the wake of data on Tuesday exhibiting a small surge in consumer prices in December.
Inflation has stayed tame even as the unemployment rate has dropped to near a 50-year low, and the longest financial expansion on record entered its 11th year.
The producer worth index for remaining demand ticked up 0.1% last month after being unchanged in November, the government mentioned. In the 12 months by December, the PPI increased 1.3% after gaining 1.1% in November.
For all of 2019, the PPI surged 1.3%. That was the smallest gain from 2015 and adopted a 2.6% increase in 2018.
Economists forecast the PPI rising 0.2% in December and advancing 1.3% on a year-on-year basis.
Exempting the volatile food, energy, and trade services components, producer prices additionally inched up 0.1% in December after being unchanged in November.
The so-called core PPI soared 1.5% in the 12 months through December after gaining 1.3% in November. Core PPI increased by 1.5% in 2019, also the smallest advance since 2015, after rising 2.8% in 2018.
Inflation has been muted despite the U.S. imposing tariffs on billions of dollars’ worth of imported Chinese items. President Trump and Chinese VP Liu He signed an initial commerce agreement Wednesday, a first step toward defusing an 18-month trade war.