Wholesale prices have increased by 0.6% in January, pushing the annual rate to a 3.5% rise. This growth is above economists’ predictions of a 3.2% increase and suggests that inflation at the producer level remains high.
The Producer Price Index (PPI) measures wholesale prices that businesses pay each other before selling to consumers. A 10.4% increase in diesel fuel index prices was a major factor in the overall rise for final demand goods. Traveler accommodation costs also increased by 5.7%, accounting for over a third of the services PPI.
Inflation has been steadily rising, with consumer price indexes (CPI) increasing for four months in a row to reach a 3% annual increase. The Federal Reserve’s interest rate cuts may not be having the desired effect, and this PPI report is likely to bolster arguments that the Fed should continue its pause in cutting rates.
Source: https://thehill.com/homenews/5142778-wholesale-prices-ppi