UPDATE - US producer prices annually rise 1.7% in August, slowing from 2.1% in July

UPDATES WITH ADDITIONAL FIGURES

By Ovunc Kutlu

ISTANBUL (AA) - Producer inflation in the US annually rose 1.7% in August, slowing down from July and coming below expectations, according to data released Thursday.

The producer price index (PPI), which measures changes in the prices of goods and services from a producer's perspective, was estimated to show an annual gain of 1.8% in August.

The figure for July, meanwhile, was revised down to an increase of 2.1%, from a gain of 2.2%, the Labor Department's Bureau of Labor Statistics said in a statement.

On a monthly basis, PPI rose 0.2% in August, but came in higher than the market expectation of a 0.1% increase.

The monthly figure for July was revised down from a gain of 0.1% to no change.

"Prices for final demand goods were unchanged in August after rising 0.6 percent in July," said the statement. "Prices for final demand services rose 0.4 percent in August after declining 0.3 percent in July."

"Nearly 60 percent of the increase is attributable to a 0.3-percent advance in the index for final demand services less trade, transportation, and warehousing," it added.

Core PPI, which excludes volatile food, energy and trade prices, showed a 0.3% monthly increase in August, and registered a 3.3% year-on-year increase.

The monthly core PPI figure for July was kept unchanged at a gain of 0.3%, while the annual figure saw a downward revision to 3.2% from 3.3%.

"Over 40 percent of the August decline in the index for unprocessed goods for intermediate demand can be traced to a 29.8-percent drop in prices for natural gas," the statement said.

The Labor Department said prices for final demand energy decreased 0.9% in August.

"The index for processed goods for intermediate demand moved down 0.1 percent in August after rising 0.6 percent in July," it said.

"Leading the decrease, prices for processed energy goods declined 0.6 percent," it added.