Wholesale prices accelerated in February, up 0.7%

March 18 (UPI) — The producer price index for final demand goods had its sharpest rise since 2023 in February, the Bureau of Labor Statistics reported Wednesday.

The index for final demand goods — items like food and clothing — increased by 1.1% for the month. The last time the index rose by that much was August 2023 when it was up 1.6%.

Wednesday’s report comes before the Federal Reserve is expected to announce its decision on interest rates later in the day.

Foods were the biggest contributor to the increase, jumping by 2.4%. The index for energy rose 2.3% though the report predates the United States and Israel launching a war with Iran on Feb. 28.

A 48.9% increase in prices for fresh and dry vegetables was a big factor in the rising index for foods. BLS estimates more than 20% of the food index increase was attributable to fresh and dry vegetable prices.

Excluding food and energy, the producer price index went up 0.5%. The Dow Jones consensus estimated a 0.3% increase.

February also marked the largest increase in inflation on an annual basis, up 3.4%. It is the highest mark since February 2025, when core inflation rose 3.9%.

The index for final demand services climbed 0.5% in February, up for the third consecutive month.

Prices for traveler accommodation services rose by 5.7%, making an estimated 20% impact on the overall increase in the index for final demand services.