Producer Price Index Growing At Fastest Rate In History Under Biden Administration
The Producer Price Index (PPI), which measures inflation at the wholesale level, skyrocketed 9.6% year-over-year as of November, increasing at the fastest rate ever measured, the U.S. Bureau of Labor Statistics (BLS) announced Tuesday.
BLS reported that the PPI, which measures inflation before it hits consumers, was up 0.8% in November. As of October, the measure was up just 8.6% on a year-over-year basis and just 0.6% in that month alone, meaning wholesale prices went up more and to a worse yearly figure in November than they did in October.
Economists projected a year-over-year increase of the core PPI, which does not include food and energy prices, to be 7.2% year-over-year and a 0.4% increase from October. The demand for goods was the biggest driver for the increase in producer prices, soaring 1.2% in November, marginally down from October’s 1.3% figure. Final demand services inflation increased 0.7% in November, much faster than October’s 0.2%.
Producer Price Index (PPI) came in at 9.6% y/y, higher than the estimate of 9.2% and Oct's 8.8%. New record high. Strong increases across all categories. We started 2021 with PPI below 2% y/y and now we're nearly at 10%. pic.twitter.com/IhMz8iv0F0
— Liz Young (@LizYoungStrat) December 14, 2021
“While we continue to expect producer prices to reach an apex in Q4, persistent supply headwinds will keep input and transportation costs sticky and only allow for a gradual moderation in price pressure,” Mahir Rasheed, U.S. economist at Oxford Economics, said.
In the meantime, the Consumer Price Index rose 0.9% in November, bringing the key inflation indicator’s year-over-year increase to 6.8%, the highest figure in nearly four decades.
“A year ago economists predicted a two percent inflation rate, but in less than 12 months of one-party rule in Washington, consumers are instead facing the highest inflation rate in 40 years,” House Minority Leader Kevin McCarthy said.
“This did not happen by accident — President Biden’s anti-worker, anti-American energy agenda have consumers paying more virtually every time they go check out,” He added.