December wholesale prices up 0.3% with sharp jump in energy

WASHINGTON — U.S. wholesale prices rose 0.3% in December led by a the biggest jump in energy costs since June.

The Labor Department reported Friday that the gain in its producer price index, which measures inflation pressures before they reach consumers, followed a modest 0.1% gain in November and matched the 0.3% rise in October.

article continues below

The December increase reflected a 5.5% surge in energy costs, the biggest gain since a 9.6% jump in June. That offset a 0.1% drop in food costs, the first decline since August.

Gasoline prices rose 16.1% in December and accounted for nearly half of the increase in goods prices last month.

Over the past 12 months, inflation at the wholesale level has risen a modest 0.8%. The government reported Wednesday that consumer inflation was also well-behaved last year, rising just 1.4% over the past 12 months.

These low inflation reading are giving the Federal Reserve room to keep interest rates at ultra-low levels in an effort to help lift the economy out of a pandemic-induced recession. Inflation has remained below the Fed’s 2% annual target for much of the past decade.

"Inflation is still largely a no-show," said Mahir Rasheed, an economist with Oxford Economics. "While some sectors have seen prices start to heat up, broader inflation measures continue to fall short of the Fed's 2% goalpost as the economy entered the new year in a slump."

© Copyright Alaska Highway News

Popular News

Lowest Gas Prices in Chetwynd, Dawson Creek, Fort Nelson, Fort St John, Tumbler Ridge
British Columbia Gas Prices provided by GasBuddy.com

Community Event Calendar


Find out what's happening in your community and submit your own local events.