Productive inflation fell unexpectedly in the US

World World: In April, the US recorded an unexpected decline in wholesale inflation. According to government data, the producer price index (PPI) for final demand fell by 0.5%, a reversal from the stable level of March. This decline was mainly due to a drop in the prices of services, which includes hotel, air travel and portfolio management fees.

This decline in the prices of services was the biggest since December 2009. Business services, which include wholesale and retail margins, fell by 1.6%, while hotel rates saw a decline of 3.1%.

These falling prices may also affect the core personal consumption expenditure (PCE) index, a major measure of inflation considered by the Federal Reserve. Experts believe that now the growth rate of core PCE for April can be revised.

The recent 90-day trade peace between the US and China has brought some hope of relief, although high duties are still in place on most imports.