The Producer Price Index, which measures the average price changes that businesses pay to suppliers, rose 2.2% for the 12 months ended in September. On a monthly basis, prices rose 0.5%, a slight cooldown from August’s 0.7% increase. September’s overall increase was driven by a 0.9% gain in goods prices due to higher energy prices and food prices, BLS data shows. Economists had projected an annual increase of 1.6% and a monthly uptick of 0.3%, according to Refinitiv consensus estimates.
Chris Rupkey, chief economist at FwdBonds said Wednesday: “The Fed has not finished the job and stamped inflation out completely yet, and if anything, policymakers have their work cut out for them as much as the inflation we see in producer prices is coming from food and energy prices that monetary policy has less effect on.