August Producer Prices Rise More Than Expected

by Christopher Freeburn | September 13, 2012 11:42 am

August Producer Prices Rise More Than Expected

The U.S. Producer Price Index (PPI) jumped sharply in August[1], the Labor Department reported on Thursday.

Wholesale prices rose 1.7% last month, the government said. That marked the largest increase in producer prices in three years, Bloomberg noted.

It also topped the 1.2% gain that economists had forecast.

August’s rise follows a much more modest gain of just 0.3% in July.

Spiraling oil costs drove last months increase, with energy prices showing their biggest gain in three years. Finished food prices also rose by 0.9%, their largest rise since last year. Car prices slipped 0.2%.

Core PPI, which omits energy and food prices, edged up just 0.2%. That matched economists’ estimates.

Analysts said that August’s PPI increase would likely not influence economic decisions by the Federal Reserve because since prices outside of energy were mostly stable.

Endnotes:
  1. jumped sharply in August: http://www.bloomberg.com/news/2012-09-13/wholesale-prices-in-u-s-rise-most-in-three-years-as-oil-surge.html

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