Bloomberg News/Landov Wholesale inflation for goods and services rose sharply in May, but the increase was mostly due to higher oil prices, according to a measure of costs known as PPI. Wholesale costs often give clues on whether inflation is rising or falling.
The numbers: Wholesale costs in the U.S. surged in May against the backdrop of rising oil prices, adding upward pressure on inflation in a steadily growing economy marked by supply bottlenecks and shortages of skilled labor.
The producer price index jumped 0.5% in May, the Labor Department said Wednesday.
About half the increase was due to higher oil prices, which President Trump complained about in an early-morning tweet criticizing OPEC.
Oil prices are too high, OPEC is at it again. Not good!
— Donald J. Trump (@realDonaldTrump) June 13, 2018
So-called core producer prices that exclude food, energy and trade rose a much smaller 0.1% last month.
Wholesale costs rose at a yearly rate of 3.1% in May, marking the highest level since early 2012.
The increase in the core rate over the past 12 months edged up to 2.6% from 2.5%.
What happened: The wholesale cost of gas leaped almost 10% in May to mark the biggest increase since last fall.
Steel-mill products also increased 4.3%, the largest advance in seven years. Companies rushed to stock up on steel and related supplies after the Trump administration announced broad tariffs on foreign imports.
Aside from energy and steel, the cost of most goods was little changed. Food prices barely rose.
There’s little chance that recent inflationary pressures will rapidly diminish anytime soon, however. The cost of partly finished goods and raw materials both increased sharply last