(CNN)A benchmark measure of inflation slowed in July after surging in the previous month, offering a glimmer of hope that the painful inflation Americans are facing could moderate in the coming months.
The Producer Price Index, which captures prices paid to producers for their goods and services, was 9.8% higher in July, compared with a year earlier. That’s a slowdown from a sharp 11.3% year-over-year spike in June, according to data released Thursday by the Bureau of Labor Statistics.
On a monthly basis, wholesale prices fell by 0.5%, down from a revised 1% month-over-month increase in June.
Largely attributed to a cooling-off of record-high energy prices, these lower numbers are generally seen as a sign of progress in the fight against inflation. However, economists warn that yet another double-digit inflation reading sends a strong signal that the economy is not out of the inflationary woods yet.
Producer prices are generally more volatile than consumer prices, since cost fluctuations generally don’t get wholly passed through to consumers. But these expenses are partially reflected in what Americans pay for goods and services, and a high number is generally viewed as a harbinger of rising prices on consumer goods.
This new producer price data comes one day after the closely watched Consumer Price Index for July showed that the prices Americans pay for everything from food to electricity increased by 8.5% over the past year, a slower pace than the 9.1% increase in June.
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