September's producer price index (PPI) rose 1.3% on the month and 6.3% annually, far exceeding economists' forecasts and marking the largest monthly and annual gains since March 2022 and December 2022, respectively, according to the Bureau of Labor Statistics (BLS).
Economists polled by Dow Jones had forecast a 0.6% monthly advance and a 5.5% annual increase. Energy costs accounted for a sizable portion of the gains, as the U.S. war with Iran curtailed oil supply and pushed prices higher. A core measure of PPI that excludes food, energy and trade rose a more modest 0.5% in September and 5% from a year earlier.
The BLS noted that almost half of September's increase in processed goods for immediate demand was linked to rising diesel fuel prices, suggesting energy costs are spreading into other categories.
Other Economic Indicators
- Wednesday's consumer price index (CPI) rose 0.6% from August to September and 3.7% year-over-year, versus forecasts of 0.6% and 3.6%.
- Core CPI, excluding food and energy, climbed 0.3% monthly and 2.6% annually, above expectations of 0.2% and 2.5%.
- The Federal Reserve's Beige Book showed the highest number of inflation-related mentions on record, per Bespoke Investment Group.
- Retail sales grew 0.8% in September, beating the 0.4% forecast but slowing from over 1% growth the prior month.
- Retail sales excluding autos and gas stations rose just 0.25%, down from about 1.1% previously, signaling consumers may be cutting other spending due to high fuel prices.
