Producer Price Index Drops by Most in Almost 3 Years

Prices paid to U.S. producers dropped in May by the most in almost three years as energy prices slumped, the Labor Department said Wednesday.

The producer price index fell 1%, the largest drop since July 2009, following a 0.2% decline in April.

The so-called core PPI excluding food and energy rose 0.2% for the second straight month, Labor said.

The overall PPI rate decreased more than economists’ forecasts of a 0.6% decline, while the core rate matched projections, Bloomberg reported.

An increase in the PPI could indicate strong demand for goods, which would mean more shipments for trucking companies. However, if inflation begins to accelerate too quickly, it could also hurt the economy.