On the heels of report showing a surprise dip by U.S. consumer prices, the Labor Department released a separate report on Friday showing U.S. producer prices also unexpectedly decreased in the month of March.
The Labor Department said its producer price index for final demand fell by 0.4 percent in March after inching up by a revised 0.1 percent in February.
The report also showed the annual rate of producer price growth slowed to 2.7 percent in March from 3.2 percent in February.
The unexpectedly monthly decrease by producer prices partly reflected a continued slump by energy prices, which plunged by 4.0 percent in March after tumbling by 1.3 percent in February.
The report also showed a sharp pullback by food prices, which dove by 2.1 percent in March after jumping by 1.8 percent in February.
The steep drops by food and energy prices contributed to a 0.9 percent decrease by prices for goods, although prices for goods excluding food and energy rose by 0.3 percent.
Meanwhile, the Labor Department priced for services dipped by 0.2 percent in March after coming in unchanged in February.
Prices for trade and transportation and warehousing services slid by 0.7 percent and 0.6 percent, respectively, while prices for other services inched up by 0.1 percent.
The report also said core producer prices, which exclude prices for food, energy and trade services, inched up by 0.1 percent in March after rising by 0.4 percent for four straight months.
The annual rate of growth by core producer prices edged down to 3.4 percent in March from an upwardly revised 3.5 percent in February.