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• Monthly gain was in line with estimates, and annual increase was slightly off from March high
• PPI is vital as wholesale prices will reflect on consumer prices
Wholesale prices jumped briskly in May as inflationary pressures mounted on the US economy.
The Bureau of Labor Statistics on Tuesday said the producer price index (PPI) rose 0.8% for the month and 10.8% over the past year.
PPI, a measure of the prices paid to producers of goods and services, jumped in line with Dow Jones estimates and doubled the 0.4% pace in April.
Excluding food, energy and trade services, the so-called core PPI rose 0.5% in May, below the 0.6% estimate but increased from the 0.4% reading in the previous month.
The core measure was up 6.8%, matching April’s gain from a year earlier.
The two PPI readings remained near their historic highs hit in March — 11.5% for headline, and 7.1% for core.
The data is vital as the wholesale prices will reflect on consumer prices, which increased 8.6% annually in May and have been running at their highest levels since December 1981.
Prices of final demand goods moved up 1.4% in the month, the fifth consecutive rise, primarily due to the jump in energy demand by 5%.
Within that energy gain, gasoline rose 8.4%, while multiple other fuel categories pushed higher.
Picture Credit: Times
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