US wholesale prices rise less than expected but stay elevated

Summarised from 2 outlets · Updated 13 Nov, 22:08 · Archive

US wholesale prices rose 0.3% in October, below forecasts but maintaining an annual rate of 6.5%, the highest since late 2022.

Wholesale prices, measured by the producer price index, rose 0.3% for the month in October, according to the Bureau of Labor Statistics, below the consensus forecast of 0.4%. Core prices, excluding food and energy, also rose 0.3%, meeting expectations. However, on an annual basis, headline PPI jumped to 6.5%, up from 6.3% in September and marking the highest rate since November 2022.

Inflation pressures have broadened beyond energy goods. Food prices jumped 1.3% for the month, posting their largest monthly increase in eight months, driven by fresh and dry vegetables, chickens, turkeys and roasted coffee. Goods prices excluding food and energy logged their biggest monthly gain since May, rising 0.5%. Energy prices dipped 0.1% overall, though diesel fuel soared 115.2% year-over-year despite declining 7.9% for the month.

Christopher Rupkey, chief economist at FWDBONDS, said there was 'no silver lining in the report', warning that consumers face 'a fresh burst of consumer inflation'. Chris Zaccarelli, chief investment officer for Northlight Asset Management, said the data was unlikely to change the Federal Reserve's approach in December because recent consumer price data 'was already outside their comfort zone'. Markets are pricing in a quarter-point rate increase at the Fed's next policy meeting on 8–9 December, with slight odds of a half-point hike.

How it is being reported

• Wholesale inflation jumps 6.5% from last year — biggest increase since 2022: ‘No silver lining’There were more signs of inflation broadening out beyond energy goods, with food prices increasing by the most in eight months as expensive diesel raised transportation costs.New York Post · 13 Nov, 16:08
• Wholesale prices rose 0.3% in October, putting annual rate at 6.5%, the highest in nearly four yearsThe producer price index was expected to increase 0.4% in October, according to the Dow Jones consensus.CNBC · 13 Nov, 14:02

In this story: Federal Reserve · Bureau of Labor Statistics · United States

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