The U.S. producer price index (PPI) rose 0.3% in October on a seasonally adjusted basis, slightly below the 0.4% increase expected by economists surveyed by Dow Jones. The figures were released by the Bureau of Labor Statistics.
On an annual basis, headline PPI accelerated to 6.5%, up 0.2 percentage point and the highest reading since November 2022. Core PPI, which excludes food and energy, also increased 0.3% for the month, matching expectations.
The report comes just weeks before the Federal Reserve’s Dec. 8-9 policy meeting. Markets are fully pricing in a quarter-point increase in the central bank’s key rate, though there are still slight odds that the Federal Open Market Committee could opt for a half-point move. After the data release, stock futures extended gains while Treasury yields were mixed.
Earlier this week, the BLS also reported hotter-than-expected consumer inflation, with headline CPI up 0.4% in October and core CPI up 0.3%. CNBC said policymakers are increasingly concerned that inflation linked to the Iran war, higher fuel prices and President Donald Trump's tariffs is spreading more broadly through the economy.
Chicago Fed President Austan Goolsbee told CNBC that inflation pressures remain broad-based. Excluding food, energy and trade services, PPI increased 0.5% in October, goods prices rose 0.5%, and final demand services prices gained 0.2%. Prices for intermediate processed goods jumped 14.6% from a year earlier, while intermediate services prices rose 6.9%, both marking multi-year highs.
