U.S. producer prices rose in March at the fastest rate in nine months, owing largely to higher costs experienced by clothing retailers, grocers and wholesalers of chemical goods, the U.S. government said Friday.
The producer price index advanced a seasonally adjusted 0.5% after falling slightly in February, the U.S. Labor Department said . That’s the largest increase since last June and surpassed the 0.1% estimate of economists.
The wholesale cost of services surged 0.7% — the biggest spike in more than three years — to push the index higher.
Yet the cost of goods was flat, as a 1.1% increase in wholesale food was offset by a 1.2% drop in the price of energy.
Excluding the volatile categories of food and energy, so-called core producer prices jumped 0.6% last month.
The spike in prices pushed the year-over-year increase in U.S. wholesale costs to 1.4% from just 0.9% in February. That’s the highest rate since last August.
Meanwhile, a new index that tracks prices of goods and services meant to be sold to consumers also rose sharply in March. The index, known as personal consumption, climbed 0.6%. It’s expected to give a heads-up if consumer inflation is about to shift up or down.
The true cost to Americans is better seen through the consumer price index, which measures what people actually pay. The CPI, to be released Tuesday, is expected to rise a scant 0.1% in March for the third month in a row. Consumer prices have risen just 1.1% in the past year.
