Prices paid to producers of U.S. goods and services rose rapidly in November, the latest sign that progress in curbing inflation is stalling and inflation is at risk of rising again.
The Producer Price Index (PPI) rose 0.4% in November, the Bureau of Labor Statistics announced Thursday morning. This was a tenth of a point higher than expected. Furthermore, the previous month's figure was revised upward from 0.2% increase to 0.3% increase.
The producer price index rose 3% compared to a year ago, marking the first year-on-year increase since February 2023.
The PPI measures a basket of prices paid to producers of goods and services in the United States. Although different from the better-known consumer price index, both are measures of inflation. PPI excludes imports but includes exports, while CPI does the opposite. The PPI also includes prices paid by governments and businesses, two purchasers excluded by the CPI's focus on consumers.
Core producer prices, which exclude food and energy prices, rose 0.2%, slowing from a 0.3% rise in the previous month. For the year, core producer prices rose 3.4%.
Another measure, often referred to as “core-core” producer prices, rose 0.1% in the month and 3.5% year-on-year. The index excludes food, energy and trade services, which are indicators that track profits for retailers and wholesalers.
PPI is not a measure of wholesale prices, although it is often mistakenly described as such.
A sharp 3.1% rise in food prices accounted for much of the headline increase. This was due to a 54.6% increase in egg prices.
Commodity prices rose 0.7%, mainly due to increases in food items. Service prices rose 0.2%.
