Sept. 10 (UPI) -- The producer price index rose a modest 0.3% in August, the Labor Department said Thursday.
The increase was slightly better than 0.2% the index was expected to rise. The index, which measures prices businesses receive for their goods and services, increased 0.6% in July.
"The index for final demand less foods, energy, and trade services moved up 0.3% in August, the same as in both July and June," the Labor Department said. "For the 12 months ended in August, prices for final demand less foods, energy, and trade services increased 0.3 percent."
Service prices led the increase, accounting for nearly 20% of the jump, followed by higher prices in machinery, equipment, parts, and supplies. Meanwhile, the indexes for commercial airlines and investment banking tumbled.
"The moderate advance in August producer prices confirms that underlying price dynamics continue to gradually normalize," Lydia Boussour, senior U.S. economist at Oxford Economics, said. "While some see high inflation lurking around the corner, we believe there is little scope for prices to heat up meaningfully as the economy continues to only slowly recover from the COVID-19 crisis."