US Producer Inflation Surges to 5.4% on Soaring Energy Costs

The US Producer Price Index (PPI) accelerated to 5.4% in August, driven by a sharp increase in energy costs. The PPI measures changes in the cost of goods and services at the producer and supplier level.

The monthly price growth rate also accelerated, with prices increasing 0.4% over the month, compared to a 0.1% rise in July.

Energy costs were the main contributor to the overall increase, rising 4.2% over the month and accounting for more than three-quarters of the total increase.

Core inflation, which excludes food and energy prices, accelerated to 4.6% year over year from 4.3% in July.

The latest figures could make it more difficult for the Federal Reserve to bring inflation back to its 2% target.

Central bank officials are due to discuss the future course of monetary policy next week, with investors expecting them to leave interest rates unchanged again.