Labour Department data shows that last month's annual growth in the producer price index for final demand was 2.2%, down from a revised 2.7% growth in June.

The PPI statistic increased by 0.1% on a monthly basis, which was less than the 0.2% gain recorded in June and less than anticipated.

The so-called "core" PPI, which excludes more fluctuating goods like food and fuel, decreased to a monthly rate of 0.0% from an updated 0.3% in June and an annualised pace of 2.4% from 3.0%.

This data is released one day ahead of the highly anticipated consumer price index, which is predicted to reveal that inflation remained steady at 3.0% annually in July compared to June's number.

At the end of July, the Federal Reserve kept its policy rate in the same range of 5.25% to 5.50% that it has been in for over a year, but it hinted that if inflation continued to decline, a rate decrease would occur as soon as September.

Using the CME FedWatch tool, investors may determine whether the Federal Reserve will lower rates by 25 basis points or 50 basis points at its meeting in September. The market appears to be evenly split between these two possibilities.

(Sources: investing,com, reuters.com)