Washington (Reuters) – Monthly prices to the US producer unexpectedly fell in March in the middle of a sharp reduction in the cost of energy products, but import levels are expected to increase inflation in the coming months.
The producer price index for final demand fell 0.4% last month, following a revised advance above 0.1% in February, said the Labor Department on Friday.
Economists who were consulted by Reuters were high at 0.2%, after stability previously reported in February.
In 12 months until March, the index rose by 2.7% after moving 3.2% in February.
Although President Donald Trump has postponed mutual customs customs on trading partners for 90 days, he increased prices for Chinese products to 125%.
Beijing replied this Friday by a 125%degree. A 10% general interest rate on almost all US imports remain in effect, as well as a 25% speed on motor vehicles, steel and aluminum.
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However, the expected increase in inflation can be dampened in some way of softening of domestic demand, clear in the March report, which showed monthly declines in air duties, as well as hotel room prices.
Customs, which affected the financial markets and increased expectations of consumer inflation, increased the chance of a recession over the next 12 months. Consumer and companies’ confidence also dropped.
The financial markets expect the federals to allocate the interest rate cuts in June after a break in January and reduce it to 100 base points this year. The Fed’s reference rate is currently in the range 4.25% to 4.50%.