On an unadjusted basis, final demand prices climbed 6.5 per cent year on year (YoY) in May, marking the strongest annual increase since November 2022, when producer inflation stood at 7.4 per cent, BLS said in a press release.
US producer prices rose 1.1 per cent MoM in May, matching April’s increase, while annual producer inflation accelerated to 6.5 per cent, the highest since November 2022.
The rise was driven by a 2.8 per cent jump in goods prices, led by energy costs and a 23.4 per cent surge in gasoline prices.
Core producer inflation increased 5.1 per cent YoY.
The latest increase was largely driven by goods prices, which surged 2.8 per cent during the month—the biggest rise since the series began in December 2009. Nearly 80 per cent of the gain in final demand prices was attributed to higher goods costs, while prices for final demand services rose 0.3 per cent.
Energy prices were the main contributor to the increase in goods inflation, with the final demand energy index jumping 10.7 per cent. Prices for goods excluding food and energy rose 0.8 per cent.
Among individual products, gasoline prices surged 23.4 per cent and accounted for more than half of the increase in final demand goods. Prices also rose for diesel fuel, jet fuel, plastic resins and materials, industrial chemicals, and natural gas liquids. In contrast, residential electricity and sanitary paper products also recorded decreases.
Service-sector inflation remained moderate but continued to rise. The index for final demand services increased 0.3 per cent in May after advancing 0.7 per cent in April. Prices for services excluding trade, transportation and warehousing rose 0.7 per cent, while transportation and warehousing services increased 2.6 per cent. Trade service margins, however, fell 1.1 per cent.
Within services, portfolio management prices rose 4.8 per cent and accounted for more than 40 per cent of the monthly increase.
Core producer inflation also strengthened. The index for final demand excluding foods, energy and trade services increased 0.8 per cent in May, the largest monthly rise since March 2022. Over the past 12 months, the core measure advanced 5.1 per cent, the strongest annual increase since October 2022.
Fibre2Fashion News Desk (SG)
