The U.S. Producer Price Index for finished goods fell 1 percent April to May, the Bureau of Labor Statistics reported Wednesday.
On a 12-month, unadjusted basis, prices were up 0.7 percent, sharply lower than the 1.9 percent annual rate in April and the first month less than 1 percent in a year.
By comparison, the annual inflation rate for producer prices was 7.1 percent in May 2011.
For May 2012, food prices were down 0.6 percent month-to-month. Energy prices declined 4.3 percent from April.
Core prices, which is the total minus food and energy items, rose 0.2 percent month-to-month and 0.7 percent from May 2011.