Wholesale prices dropped a sharp 0.9% in July, and over the last 12 months fell by the largest amount in more than six decades of record-keeping.
The Labor Department said the decline was triple what analysts had expected and was driven by big decreases in both energy and food costs. Over the last 12 months, the prices of goods before they reach store shelves fell 6.8%.
Core inflation, which excludes energy and food, fell 0.1% last month. Economists had expected a 0.1% gain.