Wholesale Inflation Jumps Record 9.6% Over Past 12 Months
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WASHINGTON — Prices at the wholesale level surged by a record 9.6% in November from a year earlier, an indication of ongoing inflation pressures.
The Labor Department said Dec. 14 that its producer price index, which measures inflation before it reaches consumers, rose 0.8% in November after a 0.6% monthly gain in October. It was the highest monthly reading in four months.
Food prices, which had fallen 0.3% in October, jumped 1.2% in November. Energy prices rose 2.6% after a 5.3% rise in October.
PPI for final demand advances 0.8% in November; services rise 0.7%, goods increase 1.2% https://t.co/Jdh4JfaLGo #PPI #BLSdata — BLS-Labor Statistics (@BLS_gov) December 14, 2021
The 12-month increase in wholesale inflation set a new record, surpassing the old records for 12-month increases of 8.6% set in September and October. The records on wholesale prices date to 2010.
Core inflation at the wholesale level, which excludes volatile food and energy, rose 0.8% in November with core prices up 9.5% over the past 12 months.
The increase in wholesale prices was widespread, led by a 1.2% increase in the cost of goods and a 0.7% rise in the price of services.
In the goods category, the price of iron and steel scrap rose 10.7% while the price for gasoline, jet fuel and industrial chemicals all moved higher. In the food category, the price of fresh fruits and vegetables rose while the price of chickens fell.
The surge in wholesale prices followed news Dec. 10 that consumer prices shot up 6.8% for the 12 months ending in November, the biggest increase in 39 years, as the price of energy, food and many other items markedly increased.
The Federal Reserve, holding its last meeting of the year this week, is expected to announce Dec. 15 that it will accelerate the pace at which it reduces its monthly bond purchases, preparing the way to begin raising its key benchmark interest rate, possibly by mid-2022 as it seeks to demonstrate its resolve to bring inflation under control.
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