Producer prices in November saw the strongest monthly gain since July and continue to increase solidly year to date, according to the Bureau of Labor Statistics.
The data: Producer prices for final demand goods and services increased 0.8%, while producer prices for final demand goods rose 1.2%, an increase of at least 1% for the eighth time so far in 2021. Other highlights:
- Food and energy costs increased 1.2% and 2.6%, respectively.
- Excluding food and energy, producer prices for final demand goods rose 0.8%, an increase from October’s 0.6% and the fastest pace since July.
The bigger picture: “Over the past 12 months, producer prices for final demand goods and services jumped 9.7% (seasonally adjusted), up from 8.8% in October and the largest increase on record for a series dating to November 2009,” said NAM Chief Economist Chad Moutray. “Meanwhile, core producer prices increased 6.9% year-over-year in November, up from 6.3% in October and also an all-time high.”
Effects on manufacturing: Manufacturers continue to point to rising raw materials costs and supply chain disruptions as their chief challenges.
- “The rapid acceleration in prices in this data helps to explain why,” Moutray said.