July US Producer Price Index, Core PPI Rise Much More Than Expected, Year-Over-Year Rates Jump

08:47 AM EDT, 08/14/2025 (MT Newswires) -- The US Producer Price Index rose by 0.9% in July following a flat reading in June, well above the 0.2% gain expected in a survey compiled by Bloomberg as of 7:50 am ET and the largest monthly gain since June 2022.

Energy prices increased by 0.9% in the month, while food prices increased by 1.4%.

After excluding food and energy prices, core PPI was still up by 0.9%, well above the 0.2% gain expected and following a flat reading in the previous month. This was the largest gain since March 2022.

PPI was up 3.3% year-over-year in July while the core PPI rate accelerated to 3.7% year-over-year, both significantly above their respective 2.4% and 2.6% June rates. The year-over-year rate for PPI excluding food, energy and trade services increased to 2.8% from 2.5% in the previous month.

The monthly producer price index, or PPI, reported by the Bureau of Labor Statistics measures the index level of prices received by producers for products such as energy, food, vehicles, and services. The core measure, excluding the volatile food and energy components, is a measure of underlying inflation.

Sharply higher prices are a sign of demand, but an increase at the producer level without a pass-through to the consumer level would suggest smaller profits at the retail level. As a result, the stock reaction depends on the movements at both levels. Higher inflation is generally a negative for bonds.

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