Investing.com - Producer price inflation in the U.S. rose more than expected in June, while core prices also posted a bigger advance, official data showed on Thursday.
In a report, the Commerce Department said that producer prices rose by a seasonally adjusted 0.5% last month, above the forecast for a 0.3% advance and after a 0.4% gain in May. That was its first increase since December 2014.
Year-over-year, the producer price index (PPI) unexpectedly increased 0.3%, compared to expectations for a decline of 0.1% and following a drop of 0.1% in the preceding month.
The core producer price index, that excludes food and energy, rose by 0.4% in June, above forecasts for a gain of 0.1% and following a rise of 0.3% a month earlier.
Core producer prices increased at an annualized rate of 1.3% last month, above expectations for 1.0% advance and after rising 1.2% in the preceding month.
Core prices are viewed by the Federal Reserve as a better gauge of longer-term inflationary pressure because they exclude the volatile food and energy categories. Furthermore, when producers pay more for goods, they are more likely to pass price increases on to the consumer, so PPI could be considered a leading indicator of inflation.
Immediately after the report, that was released simultaneously with initial jobless claims, EUR/USD was trading at 1.1146 from around 1.1152 ahead of the release of the data, GBP/USD was at 1.3354 from 1.3378 earlier, while USD/JPY was at 105.73 from 105.67 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 96.00, compared to 95.92 ahead of the report.
Meanwhile, U.S. stock futures pointed to a higher open. The Dow futures gained 0.80%, the S&P 500 futures rose 0.73%, while the Nasdaq 100 futures advanced 0.62%.