(Kitco News) - The gold market is selling off after the latest data showed U.S. producers saw rising price pressures on balance last month.
The headline Producer Price Index (PPI) posted a 0.4% increase in August, following July’s upwardly revised 0.1% reading, the U.S. Labor Department announced on Thursday. The latest headline data was in line with expectations, as economists looked for a 0.4% increase.
In the last 12 months, headline wholesale inflation increased 5.4%, the report said, above the consensus for 5.3% and July’s upwardly revised 4.8% reading.
Core PPI, which strips out volatile food and energy costs, rose 0.2% in August, below economists’ 0.3% consensus forecast and following June’s upwardly revised 0.3% reading. Annual core PPI rose 4.6%, in line with the consensus expectation and above July’s upwardly revised 4.3% print.
Gold prices fell sharply immediately after the 8:30 am ET data release. Spot gold last traded at $4,340.78 for a loss of 1.39% on the day.
PPI is viewed as a leading inflation indicator as producers pass higher input costs on to their customers.
