US Producer Prices Unexpectedly Drop, First Decline Since April

US wholesale inflation unexpectedly declined in August for the first time in four months, adding to the case for the Federal Reserve to cut interest rates.

The producer price index decreased 0.1% from a month earlier and July’s figure was revised down, according to a Bureau of Labor Statistics report out Wednesday. From the year before, the PPI rose 2.6%.

The report suggests companies refrained from outsize price increases last month despite higher costs from President Donald Trump’s tariffs. While the step back follows a sizable advance in July, many firms have been wary that steep markups could push ...