US Producer Prices Fall 0.3 Percent in June as Gasoline Drops 12 Percent
US producer prices for final demand fell 0.3 percent in June on a seasonally adjusted basis, their first monthly decline since August 2025, the Bureau of Labor Statistics reported on 15 July. Over the twelve months to June the index rose 5.5 percent, easing from 6.0 percent in May.
The monthly drop was led by goods. Final demand goods prices fell 1.4 percent while final demand services edged up 0.2 percent. Within goods, energy prices dropped 6.4 percent and gasoline fell 12.0 percent, accounting for about two thirds of the goods decline, while food prices eased 0.6 percent. Measures that strip out the volatile items were firmer. Prices excluding foods and energy rose 0.2 percent on the month, while the measure excluding foods, energy and trade services rose 0.1 percent on the month and 5.1 percent over the twelve months to June. The BLS also revised May higher, to an increase of 0.6 percent, and recorded April at 1.1 percent, so the June fall reads as a partial reversal after two strong months rather than the end of producer price pressure.
The composition matters. The June fall was concentrated in energy goods, while the core pipeline stayed positive, with prices excluding food and energy still rising 0.2 percent, a gap of 0.5 percentage point below the headline that was driven by fuel, our reading. Further up the chain, processed goods for intermediate demand excluding foods and energy rose 0.6 percent, another sign that underlying pressure has not disappeared, our reading. The twelve month headline rate easing to 5.5 percent from 6.0 percent is a cooling of 0.5 percentage point, our calculation, and the move mirrors June consumer prices, which fell 0.4 percent, with both readings driven lower by fuel.
Why it matters: Producer prices sit upstream of consumer prices, so a fuel led decline at the factory gate points to easing pipeline pressure and reinforces the softer June inflation picture that the Federal Reserve is weighing. The sticky core, however, keeps the disinflation partial rather than broad. The reading feeds directly into the debate at the Fed’s late July meeting.
Outlook: The June data predate the mid July rebound in oil, so next month’s report will test whether firmer energy costs reverse the goods relief. Watch the interaction with consumer prices and the Fed’s policy path.
| Measure | June 2026 | Note |
|---|---|---|
| Final demand, month on month | down 0.3 percent | First fall since August 2025 |
| Final demand, twelve months | up 5.5 percent | Eased from 6.0 percent |
| Final demand goods, month on month | down 1.4 percent | Energy led |
| Energy, month on month | down 6.4 percent | Gasoline down 12.0 percent |
| Final demand services, month on month | up 0.2 percent | |
| Excluding food and energy, month on month | up 0.2 percent | Core still firm |
| Excluding food, energy and trade, month on month | up 0.1 percent | Up 5.1 percent over 12 months |
| May, revised | up 0.6 percent | April recorded at up 1.1 percent |
Sources: Bureau of Labor Statistics; CNBC.
