US Producer Inflation Accelerates to 6.3% in September
US producer prices rose 1.3% month over month in September, versus 0.5% expected. Annual headline inflation accelerated to 6.3% from August’s revised 5.6%, above the 5.3% consensus estimate.
U.S. producer prices increased 1.3% month over month in September, more than twice the 0.5% economists had forecast, Bureau of Labor Statistics data released Thursday showed. Annual headline producer inflation reached 6.3%, above the 5.3% consensus and up from August’s upwardly revised 5.6%. This was the highest annual rate since December 2022.
Core producer prices, excluding food and energy, rose 0.7% for the month, compared with expectations of 0.3%. The annual core rate was 5%, exceeding the 4.4% forecast. A narrower PPI measure that excludes food, energy and trade services increased 0.5% month over month and 5% year over year. The figures followed Wednesday’s September consumer price index report.
Headline inflation accelerated to 3.7% from 3.4%, above the 3.6% expected. Core consumer prices rose 0.3% month over month and 2.6% year over year, each a tenth above forecasts. Energy drove a record increase in goods prices. Final-demand goods prices advanced 2.6% in September, their largest rise since the series began in December 2009.
Energy accounted for more than 80% of the increase, with prices up 10.8% on the month. Producer-level gasoline prices jumped 20.3%, while diesel fuel rose 21%. Over the past 12 months, wholesale gasoline prices have climbed 64.3%, and diesel prices have more than doubled, increasing 115.2%. Service prices advanced 0.8%, their largest increase since April.
Trade margins rose 1.4%, and transportation and warehousing costs increased 3.4%. A narrower measure excluding food, energy and trade services gained 0.5% on the month and 5% over the year. Retail Sales Beat, Jobless Claims Stay Low In separate data, retail sales increased 0.8% in September, exceeding the 0.3% forecast, following an upwardly revised 1.3% rise in August. Sales excluding autos advanced 0.9%, above the 0.5% estimate.
The control group, which feeds into GDP calculations, rose 0.1%, below the 0.3% expected. August’s increase for the group was revised down to 1.2% from 1.4%. Initial jobless claims climbed to 199000 in the week ended Oct. 10, slightly below the 200000 forecast, from an upwardly revised 198000.
Continuing claims were 1.71 million, in line with forecasts and down from 1.714 million. The four-week average was little changed at 198500. Market Reaction Markets showed little movement after the data, with the tech-heavy indices At 8:37 a.m. ET, Nasdaq 100 futures were down 1.22% at around 29,586, while S&P 500 futures slipped 0.28% to near 7,697.
Dow futures gained 0.40% to about 51,829, after futures had been holding premarket losses. Memory stocks among Nasdaq 100 components were weaker before the open. SanDisk Corp. (NASDAQ: SNDK), Western Digital Corp.
(NASDAQ: WDC) and Seagate Technology Holdings plc (NASDAQ: STX) fell between 5% and 6%. Micron Technology Inc. (NASDAQ: MU) declined 4.1%. The 2-year Treasury yield briefly climbed toward 4.79% following the release, then eased to 4.76%.
The U.S. dollar index was little changed near 101.79. Gold held near $4,150 an ounce, and Bitcoin (CRYPTO: BTC) traded around $80,825. This remains a developing story.