Producer Price Index Drops by Most in Three Years

Prices paid to U.S. producers fell 0.7% in April, the largest drop in three years, the Labor Department reported Wednesday.

The decrease in the producer price index followed a 0.6% decline in March. The so-called core PPI, which excludes food and energy, increased 0.1%, Labor said.

The decline in the PPI exceeded economists’ median forecast of a 0.6% drop, Bloomberg News reported. The core rate matched economists’ projections.

The decrease was led by a 2.5% drop in energy costs, Bloomberg said.

An increase in the PPI could indicate strong demand for goods, which would mean more shipments for trucking companies. However, if inflation begins to accelerate too quickly, the economy could be hurt.