WASHINGTON: US producer prices increased less than expected in October, further evidence that inflation was starting to subside.

The producer price index for final demand rose 0.2% last month, the Labor Department said on Tuesday. Data for September was revised lower to show the PPI rebounding 0.2% instead of 0.4% as previously reported. In the 12 months through September, the PPI increased 8.0 after climbing 8.4% in September.

Economists polled by Reuters had forecast the PPI rising 0.4% and advancing 8.3% year-on-year.

Government data last week showed consumer prices rose less than expected in October, pushing the annual increase below 8% for the first time in eight months. Inflation is slowing as higher interest rates dampen demand and supply chains recover.

But with spending rotating back to labor-intensive services and the jobs market still tight, price pressures could remain elevated for a while.

US annual consumer inflation eases to still-high 7.7% in October

The Fed early this month delivered a fourth consecutive 75-basis-point interest rate hike and said its fight to lower inflation to the US central bank’s 2% target would require borrowing costs to rise further. It, however, signaled it may be nearing an inflection point in what has become the fastest rate hiking cycle since the 1980s.

Excluding the volatile food, energy and trade services components, producer prices rose 0.2% in October. The so-called core advanced 0.3% in September. In the 12 months through October, the core PPI rose 5.4% after increasing 5.6% in September.