WASHINGTON U.S. producer prices increased in July amid a rebound in the cost of services, but the trend remained consistent with a moderation in inflationary pressures.

The producer price index for final demand rose 0.3% last month, the Labor Department said on Friday. Data for June was revised lower to show the PPI unchanged instead of nudging up by the previously reported 0.1%.

In the 12 months through July, the PPI increased 0.8% after gaining 0.2% in June. The pick-up in the annual rate happened because prices were lower last year. Economists polled by Reuters had forecast the PPI would climb 0.2% on the month and advance 0.7% on a year-on-year basis.

The government reported on Thursday that consumer prices rose moderately in July, strengthening expectations that the Federal Reserve would likely keep interest rates unchanged next month. Since March 2022, the U.S. central bank has raised its benchmark overnight interest rate by 525 basis points to the current 5.25%-5.50% range.

(Reporting by Lucia Mutikani; Editing by Paul Simao)