US producer prices slip in March

Factory gate prices in the States dipped in March as energy prices fell back and service sector inflation slipped.

Total US producer prices were down 0.1% on the month and up 2.3% year-on-year, according to the Bureau of Labor Statistics.

At the 'core' level, which excludes food, energy and trade, prices advanced by 0.1% in comparison to February and rose by 1.7% on the year, after a gain of 1.7% in the month before.

Economists had been expecting a flat reading month-on-month and an annualised rate of price gains of 2.4%, while at the 'core' level prices were seen up by 0.2% on the month and 1.8% ahead versus one year ago.

Energy prices dropped 2.9% month-on-month, more than offsetting an increase of 0.9% in food prices.

Prices of services were lower across the board, with those for trade 0.1% lower, transportation and warehousing off by 0.2% and 'other' prices down 0.1%.

"We continue to expect inflation pressures to remain solid in the economy, as labor markets continue to tighten and the dollar and commodity prices are broadly stable," Blerina Uruci at Barclays Research said following Thursday's report.