Wholesale prices jump more than expected to stoke inflation fears after months of cooling
NY Post
US producer prices increased more than expected in January amid strong gains in the costs of services such as hospital outpatient care and portfolio management, heightening fears that inflation was picking up after months of cooling.
The increase reported by the Labor Department on Friday was the largest in five months.
The report followed on the heels of an increase in consumer prices in January and prompted financial markets to dial back expectations that the Federal Reserve would start cutting interest rates in June.
Data on Thursday also showed prices of imported goods surging in January.
“The Fed isn’t losing the inflation fight, but they aren’t winning either,” said Christopher Rupkey, chief economist at FWDBONDS in New York. “The data are consistent, that January is a problem month for inflation.”
The producer price index for final demand rose 0.3% last month, the largest increase since August 2023, after declining by a revised 0.1% in December, the Labor Department’s Bureau of Labor Statistics said.
