US producer prices jump 6.3% in September

US producer prices rose 6.3% in September from a year earlier, Labor Department data showed Thursday, adding to inflation pressure before November’s midterm elections.

The annual rise was above the 5.5% forecast published by MarketWatch and marked the fastest pace since 2022. The Producer Price Index also rose 1.3% from August, the widest monthly increase since March 2022, after a 0.5% monthly rise in August.

The Labor Department report said half of the September increase in goods costs was tied to gasoline prices, which rose 20.3%. Diesel fuel, fresh and dry vegetables, jet fuel, residential electric power and crude petroleum also rose.

The data came a day after the consumer price index rose more than expected to 3.7% in September. Chris Zaccarelli, chief investment officer of Northlight Asset Management, said a second straight day of higher-than-expected inflation figures made another Federal Reserve rate increase this year more likely.

A separate Commerce Department report said retail sales rose 0.8% in September from the previous month to $745.0 billion, slower than August’s 1.3% pace. The figures were adjusted for seasonal changes but not for inflation.

Michael Pearce of Oxford Economics said the headline retail sales figure was driven largely by higher gasoline spending and did not say much about the health of consumers. Excluding gasoline stations, retail sales rose 0.2%.

Nationwide chief economist Kathy Bostjancic said weaker core retail sales and lower auto sales suggested real consumer spending was likely flat in September. She said spending would depend on the strength of the labor and equity markets.