Investing.com – U.S. producer price inflation and its core reading increased as expected in November, official data showed on Tuesday.
In a report, the Commerce Department said that producer prices increased 0.4% last month, in line with forecasts for a 0.4% gain and matching October’s increase.
Year-over-year, the producer price index (PPI) rose 3.1% in November, compared to expectations for a gain of 2.9% and higher than the 2.8% increase in the preceding month.
The core producer price index, that excludes food and energy, rose 0.3% in November, beating forecasts for a gain of 0.2% but slightly lower than last month’s advance of 0.4%.
Core producer prices increased at an annualized rate of 2.4% last month, above forecasts for a 2.3% increase and at the same rate as October.
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 1.1764 from around 1.1766 ahead of the release of the data, GBP/USD was at 1.3359 from 1.3356 earlier, while USD/JPY was at 113.52 from 113.50 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 93.90 compared to 93.89 before.