Investing.com - Producer price inflation in the U.S. increased more than forecast in December, while core prices also rose more than expected, official data showed on Tuesday.
In a report, the Commerce Department said that producer prices increased by a seasonally adjusted 0.6% last month, higher than the forecast for a 0.3% advance that matched December’s gain.
Year-over-year, the producer price index (PPI) rose 1.6% in January, compared to expectations for a gain of 1.5% and following a 1.6% increase in the preceding month.
The core producer price index, that excludes food and energy, advanced by 0.4% in January, higher than forecasts for a gain of 0.2% which was the reading a month earlier.
Core producer prices increased at an annualized rate of 1.2% last month, compared to expectations for an advance of 1.1% and after rising 1.6% 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.
After the report, EUR/USD was trading at 1.0615 from around 1.0621 ahead of the release of the data, GBP/USD was at 1.2476 from 1.2482 earlier, while USD/JPY was at 113.46 from 113.39 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 100.86, compared to 100.80 ahead of the report.
Meanwhile, U.S. stock futures pointed to a flat open. The Dow futures inched up 0.05%, the S&P 500 futures advanced 0.06%, while the Nasdaq 100 futures edged forward 0.04%.
Elsewhere, in the commodities market, gold futures traded at $1,233.45 a troy ounce, compared to $1,234.00 ahead of the data, while crude oil traded at $53.21 a barrel from $53.29 earlier.