US consumer price inflation slowed slightly last month, jumping 8.3 percent compared to April 2021
US consumer price inflation slowed slightly last month, jumping 8.3 percent compared to April 2021 AFP / Frederic J. BROWN

Prices for wholesale goods in the U.S. saw a double-digit increase again last month, rising by 11% in April and adding to the inflationary pressure felt across the economy.

On Wednesday, the U.S. Bureau of Labor Statistics shared its latest data for the Producer Price Index (PPI), which measures the prices paid by wholesalers for their goods.

It found that prices grew by 11% in the last year as of April, driven primarily by a spike in demand for final demand goods like diesel fuel and motor vehicles. When more volatile food and energy prices are excluded from the final figure, core PPI only rose by 0.6% since March.

April’s numbers were slightly lower than the 11.2% increase in March, the highest year-on-year increase on record since the Labor Department first began measuring PPI in 2010. Those figures were largely fueled by surging energy prices, primarily gasoline, following Russia’s attack on Ukraine on Feb. 24.

Inflation in the service sector did not grow as acutely as it did for goods as prices for transportation and warehousing rose by 3.6% -- significantly down from March, when it grew by 5.5%.

The PPI numbers come one day after a similarly dour Consumer Price Index (CPI) reading for April that saw an 8.3% increase for American households, primarily due to higher gasoline prices.

The new numbers are sure to raise pressure on the Federal Reserve to take a bolder stance on interest rates. Last week, the central bank initiated a half-percentage point rate hike in a bid to tamp down inflation and to gauge how markets would react.

The hike was the largest by the central bank in over 20 years as the Fed aims to avoid tipping the U.S. economy into a recession. Fed Chairman Jerome Powell acknowledged that the road ahead was filled with recessionary risks and that there were variables beyond the Fed's control.

“It’s not going to be easy. And it may well depend, of course, on events that are not under our control," said Powell at a press conference last Wednesday.