US PPI soared at a record rate in March, indicating that US inflation may be far from peak.
On Wednesday, April 13, data released by the U.S. Department of Labor showed that the U.S. PPI in March increased by 11.2% year-on-year, the largest year-on-year growth rate since the institution's statistics in November 2010, 10.6% higher than the market expectations and 10% higher than the previous value. The month-on-month increase was 1.4%, also the highest value on record, with an expected value of 1.1% and the previous value of 0.8%.
Excluding food and energy with high fluctuations, the US core PPI in March increased by 9.2% year-on-year, far higher than the market expectations of 8.4%, and the previous value was 8.4%. It rose 1% month-on-month, with an expected increase of 0.5%, with the previous value of 0.2%.
This is the 23rd consecutive month-on-month increase in PPI, commodity costs maintain rapid growth, and the growth rate of the service industry price index has increased significantly. Among them, energy prices remained the biggest driver, with a month-on-month increase of 5.7%, and other categories of price indices generally rose.
From the perspective of each sub-item, in the first full month after the outbreak of Ukrainian conflict , energy, food and metal prices generally rose, and the price pressure in the production link increased. Additionally, manufacturers and other producers face even more difficult situations due to supply chain bottlenecks and labor shortages.
U.S. inflation data on Tuesday showed that the U.S. CPI hit its biggest gain since the end of 1981 due to rising food, housing and gasoline prices.
As companies try to maintain profit margins, the increase in producer input costs will be passed on to consumers.
PPI and CPI data further increased the pressure on the Federal Reserve to radical rate hike , and several Federal Reserve officials have frequently delivered hawkish speeches recently, and the probability of 50 basis points hikes in May continues to rise. After the release of
data, spot gold rose slightly by nearly $5, while US stock futures fell slightly.
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