US producer prices surged higher in May after two consecutive months of declines, driven by rising gasoline and food costs, government data released Friday showed.
The Labor Department’s producer price index rose 0.5 percent in May. Producer prices, a gauge of wholesale inflation, had fallen 0.7 percent in April and 0.6 percent in March.
Core PPI, excluding food and energy prices, moved up a tame 0.1 percent in the seventh monthly gain in a row.
Analysts had expected a 0.1 percent rise in both PPI and core PPI.
The department said that finished energy goods prices accounted for more than 60 percent of the overall index’s rise, leaping 1.3 percent with gasoline prices contributing nearly half of the increase.
Food prices rose a more modest 0.6 percent, mainly due to egg prices that soared more than 41 percent.
“Despite this report, the inflation pipeline has thinned in recent months,” said Arijit Dutta of Moody’s Analytics.
Inflationary pressures have been muted as the economy continues to grow at a modest pace four years after exiting the 2008-2009 Great Recession.
Compared with a year ago, wholesale prices for finished goods were up 1.7 percent. For the first four months of the year, the average year-on-year gain was 1.2 percent.
Gasoline, food push up US producer prices
