US Producer Prices Surge 9.7%... Inflationary Pressure Persists
[Asia Economy New York=Special Correspondent Joselgina] An additional indicator has emerged showing that the inflation pressure, the highest in 40 years, continues unabated in the United States. This is expected to further strengthen the Federal Reserve's (Fed) path of interest rate hikes.
According to the U.S. Department of Labor on the 15th (local time), the Producer Price Index (PPI) for January in the U.S. rose 1.0% from the previous month and 9.7% compared to the same month last year. This far exceeded market expectations.
The month-over-month increase was the largest in eight months since May last year. It was double the expert forecast (0.5%) compiled by Bloomberg News. The year-over-year increase also surpassed market expectations (9.1%) and nearly approached the all-time high of 9.8% recorded in December last year.
The core PPI, which excludes volatile items such as food and energy, rose 0.8% from the previous month. This was the largest increase since January 2021. Core PPI also rose 6.9% compared to one year ago.
PPI is an indicator showing inflationary pressure from the production side. The Wall Street Journal (WSJ) reported, "Although it is not directly related to consumer products and service costs, it can help understand future inflation trends," adding, "Economists are looking for signs through PPI that the recently uncomfortably high inflation has reached its peak." Bloomberg News analyzed, "It suggests that inflationary pressures may continue going forward."
Hot Picks Today
No Bacteria Detected in Arisu After 24 Hours of Repeated Drinking from a Tumbler
- Despite Surprising $23 Billion Earnings, Cisco to Lay Off 4,000 Employees for Expanded AI Investment
- High-Net-Worth Investors Increase Stock Holdings: "Samsung and SK hynix Are Basic, Now Searching for the Next Opportunity" [Investment Strategies of the Wealthy] ⑧
- "Not Just Fuel Prices: Whale Collision Risks Surge as Hormuz Blockade Reroutes Ships"
- "My Wife Is Missing"... Woman in Her 50s Still Unaccounted for Nearly a Month After Climbing Bukhansan Mountain
Earlier, the U.S. Consumer Price Index (CPI) for January was released, showing a sharp 7.5% increase compared to the same month last year, marking the highest level in 40 years. With the additional PPI data confirming continued inflation pressure, there are forecasts that it will also affect the Fed's future tightening moves. The market widely expects the Fed to raise interest rates in March. There is also speculation about the possibility of a big step increase of 0.5 percentage points at once.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
