U.S. suppliers’ price increases slowed last month to 0.5% from 1.6% in March.
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U.S. suppliers’ price increases eased a little in April as energy and food costs dropped, but producer-level inflation remained close to historic highs.
The Labor Department on Thursday said the producer-price index, which generally reflects supply conditions in the economy, increased a seasonally adjusted 0.5% in April from the prior month. That marks a deceleration from the upwardly revised 1.6% gain in March, which was pushed up by surging energy prices after Russia invaded Ukraine. April’s rate of increase was the lowest since September 2021, but was higher than the average monthly gain of 0.2% in the two years before the pandemic.
Producer prices rose 11% on a 12-month basis in April, its fifth consecutive double-digit gain, easing from an upwardly revised 11.5% increase the prior month. The March gain was the highest since records began in 2010.
The report comes a day after the Labor Department said consumer inflation edged down slightly last month from a four-decade high. That report showed the economy continued to face upward price pressures from several categories of goods and services.
The so-called core price index—which excludes the often-volatile categories of food, energy and supplier margins—slipped slightly, climbing 0.6% in April from a month earlier, after jumping 0.9% in March.
The overall trend in producer prices signals that inflation pressures continue to build throughout the production pipeline as strong demand, fueled in part by government stimulus, chokes already strained supply chains. This dynamic is being worsened by rising energy and commodities prices caused by the war in Ukraine, as well as by China’s extensive lockdowns in its bid to contain Covid-19.
Write to Gwynn Guilford at [email protected]
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