Prices paid to U.S. producers rose in March from a year ago by the most in records back to 2020, surpassing all estimates and underscoring the persistent inflationary pressures.
- The producer price index for final demand rose 11.2% from March of last year and 1.4% from the previous month. The monthly gain was broad across categories and also the largest on record.
- The core PPI, excluding the volatile food and energy components, rose slightly 1% from a month earlier and was up 9.2% a year ago.
- The PPI reports reinforce pressure on the Federal Reserve to hike rates more aggressively. Central banks have opened the opportunity to a half-percentage point increase in interest rates in May.
- The headline PPI and core figures surpassed estimates. The average forecasts in a Bloomberg survey of economists called for a 10.6% year-over-year surge and a 1.1% monthly advance.
Producer prices, excluding food, energy, and trade services, increased by 0.9% from February, the biggest gain since the start of 2021. The measure jumped 7% from a year ago.
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Source: U.S. Bureau of Labor Statistics.