Wholesale prices rose 0.2% in June, slightly hotter than expected

A measure of wholesale prices rose more than expected in June as Wall Street assesses when the Federal Reserve will feel comfortable cutting interest rates.

The producer price index climbed 0.2% last month, the Labor Department's Bureau of Labor Statistics reported Friday. Economists surveyed by Dow Jones were expecting a 0.1% increase for the index. The PPI is now up 2.6% over the past year.

The PPI is a gauge of prices that producers can get for their goods and services in the open market. In June, a rise in the price for services offset a decline for goods.

The reading is an increase from the May number, which was also revised higher. Friday's report said that the index was unchanged in May as compared with a decline of 0.2% in the original release.

The hotter-than-expected PPI reading runs counter to recent data that shows inflation declining, though economists and investors tend to put more weight on the consumer-focused inflation readings.

Friday's report comes after the June consumer price index came in cooler than expected on Thursday. The CPI actually showed that headline inflation declined on a monthly basis and now sits at 3% year over year.

The central bank's next policy meeting is at the end of July, where it is widely expected to hold rates steady. Traders have increasingly dialed in on the September meeting as the likely time for the first rate cut.

The Fed's preferred inflation reading is the personal consumption expenditures price index. The June PCE data is slated for release on July 26.