WASHINGTON (NWN) – Inflation at the wholesale level rose 8.6% last month from a year ago, matching September’s record annual gains and offering more evidence that inflationary pressures are not yet easing.
The Labor Department reported Tuesday that its producer price index – which measures inflation before it hits consumers – rose 0.6% last month from September, more than offset by a rise in gasoline prices. Excluding volatile food and energy prices, wholesale inflation was 0.4% in September to October and 6.8% higher than a year ago.
Over 60% increase in total producer prices in September-October was due to a 1.2% increase in the price of wholesale goods as opposed to services. A 6.7% jump in wholesale petrol prices helped push up the prices of the commodities.
Inflation, mostly dormant for decades, has returned to the United States this year. The economy’s strong rebound from the 2020 coronavirus took many businesses by surprise. Their scramble to meet the unexpectedly strong demand has created shortages of labour, raw materials and goods and clogged traffic at ports and goods yards. The result has been higher prices, and the supply squeeze is expected to last well into at least 2022.
“Since the pandemic, supply chains have never been the same and are unlikely to return to normal for several more months,” Casual Macro Advisors said in a research note.
The Labor Department will release its consumer price index for last month on Wednesday. According to a survey of economists by FactSet, it is expected to show that consumer prices rose 0.5% since September and 5.8% from a year earlier – trailing September’s 5.4% year-over-year gain. , the fastest since 2008.