Dec. 12 (UPI) — Wholesale prices grew by twice the rate Wall Street predicted, according to a new report from the Bureau of Labor Statistics on Thursday, bringing new fears that efforts to bring down inflation have slowed or even stalled.
The report said the produce price index, which documents the prices producers receive for their products, increased by 0.4% in November.
Dow Jones experts had predicted those prices would increase by 0.2% last month.
The index increased 3% from where it was the same time last year, a full point over the benchmark by the Federal Reserve. It was the largest year-to-year increase for the PPI since February 2023.
The good news out of the report was that the producer price index for “core items,” which excludes the more volatile food and energy prices was 0.2%, meeting Wall Street expectations.
The final demand for goods index jumped 0.7%, of which 80% can be traced back to higher food prices. The food increase skyrocketed 3.1%. In the food category, the price of chicken eggs catapulted 54.6%, while the prices for fresh and dry vegetables, fresh fruits and melons, processed poultry, cigarettes, and residential electric power also increased.
Final demand prices for services increased 0.2% last month, marking the fourth straight monthly increase while staying within the Fed benchmark. Trade services increased by 0.8% while prices in the trade, transportation, and warehousing sector rose 0.1%.
Machinery and vehicle wholesaling increased by 1.8%. In contrast, airline passenger services dropped 2.1%, along with guestroom rentals, computer hardware, and software and supplies retailing.
