U.S. wholesale costs posted the biggest increase in April since the fall of 2012 as they rose sharply for the second straight month, suggesting that price pressures might be building a bit after an extended period of extremely low inflation.
The producer price index jumped a seasonally adjusted 0.6% last month following a revised 0.5% increase in March, the Labor Department said Wednesday. Economists polled by MarketWatch had expected a 0.2% increase.
The index also showed wholesale costs appear to be accelerating. Producer prices have risen 2.1% in the past 12 months, up from 1.4% in March and just 0.9% in February.
Yet economists caution against reading too much into the PPI because the index underwent its first major makeover in years at the start of 2014. The index has been quite volatile in its new incarnation.
Excluding the volatile categories of food, energy and trade, core wholesale prices rose a smaller 0.3% last month, the Labor Department said Wednesday.
The price of goods jumped 0.6% in April as the wholesale cost of food and gasoline rose.
The price of services also increased 0.6%, led by higher costs for airline tickets. Grocery and liquor-store costs advanced as well.
Personal consumption, a new index designed to foreshadow changes in the consumer price index, surged 0.7% in April.
Source: marketwatch
