The Labor Department reports on U.S. producer price inflation in May at 8:30 a.m. Eastern Friday.
Prices Up: The expectation is that prices at the wholesale level increased 0.4 percent in May, according to a survey of economists by data firm FactSet.
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LOW INFLATION: In April, a sharp drop in the cost of gasoline and food reduced overall wholesale prices, resulting in a decline of 0.4 percent.
Even excluding the volatile food and energy categories, the core producer price index slipped 0.2 percent in April. The expectation is that the overall price index and the core index will both be up in May. Economists are forecasting a rise of 0.2 percent for core inflation.
One reason to expect higher overall inflation is a rebound in gas prices. The nationwide average for a gallon of regular gas is now up to $2.76, compared to $2.66 a month ago. Even with the increase, a gallon of gas is still 88 cents below where it was a year ago.
Federal Reserve officials are monitoring measures of inflation as they weigh whether to raise a key short-term interest rate. They have kept it at a record low near zero for more than six years. Fed officials have said they want to be "reasonably confident" that inflation is headed toward their 2 percent target, which would signal a stronger economy.
The Fed meets to consider interest rates next week, but most economists believe they will not move to boost rates at that meeting or at the following meeting in late July. Instead, many private economists are looking at September as the likely date for the Fed's first rate hike in nearly a decade.
Analysts believe the Fed wants to be assured that the economy has rebounded from the period of weakness during the winter and the job market is continuing to improve. And even when the Fed starts raising rates, analysts believe the moves will be very gradual, especially if inflation continues to fall below the central bank's preferred 2 percent level.