- Wholesale prices rose 0.4% in August, matching economists’ expectations, as reported by the Bureau of Labor Statistics.
- Annual PPI increased to 5.4% in August, a 0.7% acceleration from 4.7% in July, driven by rising energy prices.
- Stock futures extended losses following the release of the producer prices data, with Dow E-minis down 152 points, or 0.29%.
- July PPI was revised up to a 0.1% increase from no change, indicating a slight improvement in wholesale price trends.
- Energy prices significantly contributed to the increase in wholesale inflation, with final-demand energy prices rising 4.2%.
Wholesale prices in the U.S. rose 0.4% in August, matching economists' expectations and marking a significant increase from July's 0.1%. This rise was primarily driven by energy prices, which surged 4.2%, particularly due to a 24.1% increase in diesel costs.1289
The Producer Price Index (PPI), which measures price changes received by producers, increased to 5.4% annually, up from 4.7% in July. This acceleration is 0.1 percentage point higher than expected and remains well above the Federal Reserve's 2% inflation target.
The report, released by the Bureau of Labor Statistics, could influence the Federal Reserve's upcoming interest rate decision, as stock futures extended losses following the data. At 8:34 a.m. ET, Dow E-minis were down 152 points, or 0.29%, while S&P 500 E-minis fell 36.25 points, or 0.47%.56
Excluding food and energy, core PPI rose 0.2%, slightly below the forecast of 0.3%. Overall, goods prices increased 1.1%, while services prices saw a modest rise of 0.1%, driven by a 2.3% increase in transportation and warehousing costs. The report coincided with U.S. crude oil prices topping $100 a barrel, further impacting market sentiment.
“The annual rate accelerated from 4.7% in July, still well above the Fed's 2% target, with final-demand energy prices up 4.2% and diesel surging 24.1%. The report could strengthen the case for a Fed rate hike at its meeting next week.”
CNBC
