American business were paid less for their goods and services in September than they were a month earlier.
The Department of Labor’s Producer Price Index fell 0.3 percent in September from a month earlier. Compared with a year ago, prices were up 1.4 percent.
The Producer Price Index measures prices received by U.S. businesses. It tends to track closely the more familiar Consumer Price Index, which measures prices paid by U.S. consumers.
The data released Tuesday morning showed inflation running cooler than expected and cooler than earlier in the year. Economists had forecast a monthly rise of one-tenth of a percent and an annual increase of 1.8 percent, matching August’s figures.
The lower-than-expected price increase should make it easier for Jerome Powell and the rest of the Federal Reserve’s monetary policymakers to cut interest rates at the end of its two-day meeting in late October.
Economists often strip out food and energy prices, which can be volatile month-to-month, to look for underlying price pressures. For September, however, this does not change the picture month. Less food and energy, prices fell 0.3 percent compared with a month earlier and rose 2 percent compared with a year earlier.
Trade services is also sometimes stripped out to get at core-inflation. This component of the producer price index does not measure prices received. Instead, it is a measure of mark-ups received by middlemen and retailers, showing the difference between prices paid and prices received. Less food, energy, and trade services, prices were flat for the month and up 1.9 percent compared with a year ago.
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