Please ensure Javascript is enabled for purposes of website accessibility
Back-to-Back Price Hikes, Wholesale Costs up 1% in July
gvw_ap_news
By Associated Press
Published 4 years ago on
August 12, 2021

Share

WASHINGTON — Inflation at the wholesale level jumped a higher-than-expected 1% in July, matching the rise from the previous month, and dimming hopes that the upward trajectory of prices would begin to slow.

Prices at the wholesale level over the past 12 months are up a record 7.8%, the largest increase in that span of time in a series going back to 2010.

And the back-to-back monthly increases in the producer price index, which measures price pressures before they reach consumers, were the most sizeable since a 1.2% rise in January, the Labor Department reported Thursday.

Wholesale Inflation Exceeds Economists’ Predictions

The latest data on rising producer prices comes a day after the U.S. reported that there was some evidence of slowing in price hikes at the retail level. Consumer prices in July rose 0.5%, compared with a 0.9% jump in June. Over the past year retail prices are up a notable 5.4%, the same 12-month gain posted in June with both months recording the largest annual gain since 2008.

July’s 1% wholesale price uptick exceeded the 0.6% gain many economists had expected and signaled the price surge that has lifted the cost of everything from airline tickets and hotels to food and gasoline, has pushed prices well above the 2% target for annual gains set by the Federal Reserve.

Core inflation at the wholesale level, which excludes volatile food and energy costs, also rose 1% in July. Core prices over the past 12 months are up 6.2%.

“Price metrics continue to be impacted by pandemic-related effects including strong demand and supply constraints,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics. “The reopening impact should diminish over coming months but there is less certainty about supply dislocations, which could be exacerbated due to spread of the delta variant.”

Prices Up Due to Rising Cost of Services and Lack of Supply

Nearly three-fourths of the 1% July increase in wholesale prices were generated by the rising cost of services, which rose 1.1%. There were hefty gains in margins for autos and auto parts, which jumped 11.2%. Retail prices for new cars and used cars have been rising sharply in recent months as a computer chip shortage shuts down auto plants.

The price of goods at the wholesale level rose 0.6%, led by a 2.6% increase in energy prices, the biggest energy gain since a 5% increase in March.

Food costs actually fell 2.1%, the first price drop for food since December.

RELATED TOPICS:

DON'T MISS

What Are Fresno Real Estate Experts Predicting for 2025 and Beyond?

UP NEXT

Stop Making Cents: US Mint Moves Forward With Plans to Kill the Penny

9 of a Doctor’s 10 Children Are Killed in Israel’s Latest Strikes in Gaza

1 day ago

Daisy Can’t See or Hear, but She Knows How to Love

2 days ago

Clovis Memorial Run Brings the Community Together, Supports Senior Programs

The annual Clovis Memorial Run brought runners and walkers to the new Clovis Senior Activity Center on May 24, featuring multiple races that...

1 day ago

1 day ago

Clovis Memorial Run Brings the Community Together, Supports Senior Programs

1 day ago

Attorney Error Lowers Fees in Fresno Measure P Case

1 day ago

Trump Gives Commencement Address at West Point, Stressing a New Era

1 day ago

9 of a Doctor’s 10 Children Are Killed in Israel’s Latest Strikes in Gaza

Blind and deaf, Daisy is a gentle senior pup who has blossomed in foster care and is now searching for a loving home. (Mell's Mutts)
2 days ago

Daisy Can’t See or Hear, but She Knows How to Love

2 days ago

How to Travel Without a Phone

2 days ago

Chukchansi Casino Hosts Job Fair to Fill 80 Food and Beverage Positions

California Wealth and Poverty
2 days ago

California’s High Living Costs and Rampant Poverty Sharpen Its Economic Divide

Help continue the work that gets you the news that matters most.

Search

Send this to a friend