Wholesale inflation spikes 6.3% YoY in September, driven by fuel price surge
The Labor Department reported a 6.3% year-over-year rise in the producer price index for September, the largest since December 2022, as wholesale gasoline prices jumped more than 20%.
Wholesale inflation accelerated in September, with the Labor Department’s producer price index rising 6.3% from a year earlier, up from 5.6% in August and marking the strongest gain since December 2022. On a month-to-month basis, prices increased 1.3% from August, the biggest rise since March 2022, after a 0.5% gain the prior month.
The surge was largely fueled by a more than 20% jump in wholesale gasoline costs, while electricity, vegetables, shipping and air-fare prices also climbed. Core prices, which exclude food and energy, rose 0.7% from August and 5% year-over-year.
The higher wholesale costs feed into the consumer price index, which also rose in September, adding pressure on the Federal Reserve’s policymakers. The central bank, which has kept inflation above its 2% target for over five years, is expected to maintain its key short-term rate at the upcoming policy meeting, though officials have indicated a possible rate hike later in the year.
The Labor Department noted that average weekly paychecks, adjusted for inflation, fell for the first time since May, reflecting the broader impact of rising prices on household incomes. A recent Associated Press-NORC poll showed low approval ratings for President Trump’s handling of the cost of living and the overall economy.