US producer prices remain muted in May

Factory gate prices in the States were unchanged last month as weaker prices for goods offset dearer services.

Total producer prices in the US were flat in May versus April, while the year-on-year rate dipped from a 2.5% clip to 2.4%, according to the Bureau of Labor Statistics.

Economists had projected no change in prices versus April and a 2.3% rate of increase year-on-year.

Excluding food, energy and trade producer price inflation slipped by 0.1% month-on-month after rising by 0.7% in April.

Against the year-ago period, the rate of change in producer prices excluding food, energy and trade was 2.1%, unchanged from the prior month.

So-called final demand prices for goods dropped by 0.5% month-on-month following an identical rise during the previous month, as energy prices declined by 3.0% on the month.

Prices for final demand services increased by 0.3% on the month after an advance of 0.4% during April.

"Over the past year, both core goods and services prices have accelerated, with the year-on-year rates now at 2.2% and 2.1% respectively; both were near zero in late 2015. So far, though, pass-through into core consumer inflation has been minimal," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.