U.S. Producer prices increased significantly in October, signaling that high inflation could persist for a prolonged period as supply constraints persist.
Source: U.S. Bureau of Labor Statistics.
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The producer price index for the final demand increased by 0.6% the previous month after rising 0.5% in September. In the past 12 months to October, the PPI was up 8.6% after a similar increase in September.
The core PPI, excluding food and energy elements, rose by 0.4% and increased 6.8% from a year ago. A larger percentage of the core increase was driven by goods that jumped 1.2%.
Elevated energy costs, including the prices for gasoline, also contributed to the gain. The cost of services increased by an average of 0.2% for a second straight month, indicating a further pullback in the cost of securities brokerage.
With ongoing supply chain constraints forecasted to persist into 2022, sustained price increases signaled additional consumer price increases in upcoming months.