The Labor Department reported Wednesday that rising fuel prices contributed to the US August cheap wholesale corsets inflation rate in four months to reach the maximum increase.
Despite reversing the decline in July, the producer price index is still below analysts’ expectations.
Although the fuel price index soared last month, it was not affected by Hurricane Harvey because the information used to calculate growth was collected before the storm hit.
But the impact of the storm in September may feel.
Harvey landed at the end of the Texas Gulf Coast, closing a large portion of US production and refining capacity, causing fuel and crude oil prices to rise.
Pantheon Macroeconomics Ian Shepherdson wrote in the customer note: “In the next few months, we are dominated by PPI soaring.
He pointed out that following the 2012 Super Sandy Sandy, the core PPI rose 0.5%.
The total PPI, which tracks the cost of wholesale goods and services, rose 0.2% this month, and the Labor Department said analysts’ percentages were down 0.3%.
An increase of 0.1% in the previous month, is the highest since April rose 0.5%. An increase of 2.4 percentage points, an increase of one fifth in July.
August PPI mostly grew from the cargo sector, including energy, up 3.3%.
Excluding unstable food and fuel categories, the “core” PPI rose 0.1%, also lower than expected, up 2.0% from August 2016.
In terms of energy, the average monthly growth of residual fuels, household heating and jet fuels increased double-digit, up 18.6 percent year on year, the fastest in eight years.
While wholesale gasoline prices rose 9.5% this month, the largest increase since January.
Analysts said the Fed could see energy prices as a temporary phenomenon, but reconstruction in Texas and Florida back-to-back hurricanes could push up demand and prices for construction and other services.
US inflationary weakness this year has put monetary policy makers and economists deadlocked. The Fed is expected to cut its benchmark interest rate at the meeting next week, and the possibility of raising interest rates for the third time this year has come down, especially after the hurricane.
In contrast to energy, food prices dragged the monthly index, wheat prices fell 20.6%, the largest decline in nine years.
The aeronautical transport services sector grew by 1.4%, the largest increase since July 2009, while the trucking services increased by 0.9%, the largest increase in three years.