US producer inflation beats forecast as diesel spikes
US wholesale inflation picked up more than expected in August, government data showed on Thursday, driven by higher energy costs in the month – particularly for diesel – as the US war on Iran continued. The Producer Price Index (PPI) was up 5.4 percent year-on-year last month, the Department of Labour said. This was a significant acceleration from the 4.8 percent rise in July. On a month-on-month…
US wholesale inflation surged beyond expectations in August, according to government data released on Thursday. The increase was primarily attributed to a rise in energy costs, especially for diesel, as the ongoing US war on Iran persisted. The Producer Price Index (PPI) climbed 5.4 percent year-on-year, marking a substantial rise from the 4.8 percent increase seen in July.
On a month-to-month basis, PPI experienced a growth of 0.4 percent. Energy expenses surged by 4.2 percent over the course of the month. Diesel fuel costs, in particular, played a significant role in this surge, with prices jumping by 24.1 percent. The report attributed this dramatic rise in diesel prices to the ongoing conflict between the US and Iran, which escalated in late February when US-Israeli strikes targeted Iran.
In retaliation, Iran blocked the Strait of Hormuz, a vital route for global energy transportation. The waterway's closure led to a spike in energy costs and put pressure on voters as they approached the upcoming US midterm elections. Diesel, essential for road transportation and agriculture, has reached a record-high price in the United States this week.
Currently, the national average stands at $5.98 per gallon, a significant jump from the previous year's average of $3.71 per gallon, as reported by the AAA motorists' association.
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