(Washington) The wholesale price index, which measures the rise in prices on the producer side, continued to rise in April, faster than the markets anticipated, confirming the evolution of inflation on the consumer side, which also continues to accelerate.
Wholesale prices rose 2.2% year-on-year, compared to 2.1% in March, according to the PPI producer price index released Tuesday by the Commerce Department.
Over one month, the increase is 0.5%, compared to 0.1% in March, the data of which was revised slightly downward. This is more than what analysts expected, who instead forecast an increase of 0.3%, according to the Briefing.com consensus.
This increase over one month “is mainly attributable to an increase in the prices of services”, while “the final demand price index for goods increased” in a less marked manner, details the Department of Commerce in its press release.
The PPI index measures producer-side inflation. Inflation on the consumer side is measured, among other things, by the CPI index, to which pensions are indexed and which accelerated in March. Data for April will be released on Wednesday.
“The PPI surprised on the upside,” acknowledged Rubeela Farooqi, chief economist for HFE, in a note, “coupled with persistent CPI inflation, the data supports the Federal Reserve’s view that rates should remain high longer than initially expected.
The PCE index, favored by the Fed for its monetary policy, had in fact accelerated in March, according to data published at the end of April, to reach 2.7% over one year, against 2.5% a month earlier.
She convinced the American central bank to keep its rates unchanged during its last meeting, on April 30 and 1er May, and a rate cut is no longer expected by the markets with the mid-September meeting, at best, being the last before the American elections.