US producer inflation reaches 5.4% in August
US producer prices rose 5.4 per cent in the 12 months through August, accelerating from July and coming in slightly above market expectations, as higher energy costs pushed wholesale inflation to its strongest annual pace in months. The Producer Price Index for final demand increased 0.4 per cent from July on a seasonally adjusted basis, the Bureau of Labor Statistics said on Thursday. The…
US producer prices surged 5.4% in the 12 months leading up to August, surpassing expectations and marking a significant acceleration from the previous month. Higher energy costs were the main driver, with wholesale inflation reaching its strongest annual pace in months. The Producer Price Index for final demand increased 0.4% from July, in line with economists' forecasts.
The annual rise exceeded the roughly 5.3% rate anticipated by some forecasters. Energy prices, particularly diesel fuel, surged 24.1% from July, while gasoline, jet fuel, and home-heating oil also rose. Food prices increased only slightly, limiting some of the pressure from energy. Services prices were comparatively subdued, rising just 0.1%.
The acceleration in producer inflation was largely concentrated in goods, with final-demand goods prices advancing 1.1% in August, driven by the 4.2% jump in energy prices. The narrower measure excluding food, energy, and trade services also rose, providing a steadier indication of underlying producer-price pressure. Inflation concerns persist as the Federal Reserve prepares for its September policy meeting, with financial markets reacting positively to the data, anticipating possible interest rate hikes.
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