US Producer Prices Soar 10.8% in May as Energy Energy Costs Spike

Producer prices in the United States increased 10.8% year over year in May, highlighting the economy’s continued danger from inflation, which shows no signs of abating. The producer price index — which gauges inflation before it reaches consumers — climbed at a little slower pace this month than in April, when it soared 10.9 percent from a year earlier, and is down from an 11.5 percent yearly rise in March, according to the Labor Department’s report.

Producer prices jumped 0.8 percent in May compared to April, above the previous month’s 0.4 percent gain. Energy Costs, driven by gas, increased by 5% in May compared to April. A high 2.9 percent increase in the Costs of truck freight carrying was another major driver of price increases last month, indicating that supply chain issues have yet to be entirely rectified. The price of food remained steady.

According to the data, rising Costs will continue to eat away at Americans’ earnings and wreck havoc on their household budgets in the coming months. Inflation has caused big political issues for President Joe Biden and congressional Democrats, forcing the Federal Reserve to respond with a series of quick interest rate hikes aimed at slowing the economy and containing price rises.

The government said on Friday that inflation, as measured by the consumer price index, hit a fresh 40-year high of 8.6% in May, a surprise spike that defied predictions that price hikes would halt. Gas and food prices increased dramatically as a result of Russia’s invasion of Ukraine, but rent, new and used automobiles, medical care, and apparel prices also increased, indicating that inflation is spreading more widely across the economy.