Current:Home > InvestUS wholesale inflation accelerated in November in sign that some price pressures remain elevated -Wealth Evolution Experts
US wholesale inflation accelerated in November in sign that some price pressures remain elevated
View
Date:2025-04-25 01:21:20
WASHINGTON (AP) — Wholesale costs in the United States picked up sharply last month, signaling that price pressures are still evident in the economy even though inflation has tumbled from the peak levels it hit more than two years ago.
The Labor Department reported Thursday that its producer price index — which tracks inflation before it reaches consumers — rose 0.4% last month from October, up from 0.3% the month before. Measured from 12 months earlier, wholesale prices climbed 3% in November, the sharpest year-over-year rise since February 2023.
Excluding volatile food and energy prices, so-called core producer prices rose 0.2% from October and 3.4% from November 2023.
Higher food prices pushed up the November wholesale inflation reading, which came in hotter than economists had expected. Surging prices of fruits, vegetables and eggs drove wholesale food costs up 3.1% from October. They had been unchanged the month before.
The wholesale price report comes a day after the government reported that consumer prices rose 2.7% in Novemberfrom a year earlier, up from an annual gain of 2.6% in October. The increase, fueled by pricier used cars, hotel rooms and groceries, showed that elevated inflation has yet to be fully tamed.
Inflation in consumer prices has plummeted from a four-decade high 9.1% in June 2022. Yet despite having reached relatively low levels, it has so far remained persistently above the Fed’s 2% target.
Despite the modest upticks in inflation last month, the Federal Reserve is poised to cut its benchmark interest rate next week for a third consecutive time. In 2022 and 2023, the Fed raised its key short-term rate 11 times — to a two-decade high — in a drive to reverse an inflationary surge that followed the economy’s unexpectedly strong recovery from the COVID-19 recession. The steady cooling of inflation led the central bank, starting in the fall, to begin reversing that move.
In September, the Fed slashed its benchmark rate, which affects many consumer and business loans, by a sizable half-point. It followed that move with a quarter-point rate cut in November. Those cuts lowered the central bank’s key rate to 4.6%, down from a four-decade high of 5.3%.
The producer price index released Thursday can offer an early look at where consumer inflation might be headed. Economists also watch it because some of its components, notably healthcare and financial services, flow into the Fed’s preferred inflation gauge — the personal consumption expenditures, or PCE, index.
Despite the overall uptick in producer prices, Paul Ashworth of Capital Economics noted in a commentary that the components that feed into the PCE index were “universally weak” in November and make it even more likely that the Fed will cut its benchmark rate next week.
President-elect Donald Trump’s forthcoming agenda has raised concerns about the future path of inflation and whether the Fed will continue to cut rates. Though Trump has vowed to force prices down, in part by encouraging oil and gas drilling, some of his other campaign vows — to impose massive taxes on imports, for example, and to deport millions of immigrants working illegally in the United States — are widely seen as inflationary.
Still, Wall Street traders foresee a 98% likelihood of a third Fed rate cut next week, according to the CME FedWatch tool.
Disclaimer: The copyright of this article belongs to the original author. Reposting this article is solely for the purpose of information dissemination and does not constitute any investment advice. If there is any infringement, please contact us immediately. We will make corrections or deletions as necessary. Thank you.
veryGood! (5)
Related
- Trump issues order to ban transgender troops from serving openly in the military
- What to know about how much the aid from a US pier project will help Gaza
- Michigan beginning alcohol sales at football games following successful rollouts at its other venues
- Latinos found jobs and cheap housing in a Pennsylvania city but political power has proven elusive
- Megan Fox's ex Brian Austin Green tells Machine Gun Kelly to 'grow up'
- Chad’s military leader is confirmed as election winner in the final tally despite opposition protest
- Philadelphia still the 6th-biggest U.S. city, but San Antonio catching up, census data shows
- Rock band Cage the Elephant emerge from loss and hospitalization with new album ‘Neon Pill’
- Google unveils a quantum chip. Could it help unlock the universe's deepest secrets?
- Will Costco, Walmart, Target be open Memorial Day 2024? What to know about grocery stores
Ranking
- From family road trips to travel woes: Americans are navigating skyrocketing holiday costs
- Brothers accused of masterminding 12-second scheme to steal $25M in cryptocurrency
- Nick Jonas Debuts Shaved Head in New Photo With Daughter Malti Marie
- Man convicted of attacking ex-Speaker Nancy Pelosi’s husband with a hammer is to be sentenced
- FACT FOCUS: Inspector general’s Jan. 6 report misrepresented as proof of FBI setup
- Mosque attack in northern Nigeria leaves 8 people dead. Police say the motive was a family dispute
- Brothers accused of masterminding 12-second scheme to steal $25M in cryptocurrency
- West Virginia miner dies in state’s first reported coal fatality of the year
Recommendation
The Louvre will be renovated and the 'Mona Lisa' will have her own room
Blinken’s Kyiv song choice raises eyebrows as Ukraine fights fierce Russian attacks
Chris Pratt Speaks Out on Death of His Stunt Double Tony McFarr at 47
Matt Gaetz evokes ‘standing by’ language adopted by Proud Boys as he attends court with Donald Trump
See you latte: Starbucks plans to cut 30% of its menu
Drake, Kendrick Lamar and More Score 2024 BET Awards Nominations: See the Complete List
Psychedelic therapy and workers’ rights bills fail to advance in California’s tough budget year
Key Boeing supplier Spirit AeroSystems is laying off 450 after production of troubled 737s slows