US wholesale prices up tiny 0.1% in August

US wholesale prices edge up slight 0.1% in August as energy prices fall sharply

WASHINGTON -- U.S. wholesale prices edged up a slight 0.1% in August as energy prices took a big plunge, a further sign that inflation is remaining tame.

After bigger gains in April and May, driven by a surge in energy costs, wholesale inflation has returned in the past four months to the tiny increases seen during much of this record-long economic expansion, now in its 11th year.

Given the low inflation, the Federal Reserve is expected to cut its key interest rate for a second time this year at next week's meeting.

Over the past 12 months, wholesale prices have risen 1.8% while core wholesale prices are up 2.3%.

In his tweet, Trump argued that the Fed should go much further and reduce rates to zero. The Fed's policy rate is currently in a range of 2% to 2.25%.

Trump tweeted , "It is only the naïveté of Jay Powell and the Federal Reserve that doesn't allow us to do what other countries are already doing. A once in a lifetime opportunity that we are missing because of "Boneheads."

When it reduced rates in July, the Fed said it was doing so because of the uncertainties generated by Trump's trade policies, slower global growth and the failure of inflation to rise to the central bank's 2% target.

While overall inflation pressures remained modest, some categories did show big increases. Hotel room rentals jumped 6.4%, a record amount, and insurance and gaming receipts also climbed by record amounts.

———

AP White House reporter Darlene Superville contributed to this report.