The Labor Department said Friday that its producer price index for final demand rose 4.2% year over year, quickening from last month’s 2.8% increase. The March reading made for the largest annual increase since September 2011.
Prices jumped 1% month over month, doubling the increase in February.
Economists surveyed by Refinitiv had expected producer prices to rise 3.8% from a year ago and 0.5% versus the prior month.
Nearly 60% of the increase in the index for final demand was due to a 1.7% rise in prices for final demand goods. The increase was the largest since the index began in December 2009.
Within the final demand goods category, prices for final demand energy, which rose 5.9%, accounted for almost 60% of the increase. Gasoline prices rose 8.8%, making up more than a quarter of the increase, while diesel fuel, residential electric power, industrial chemicals, steel mill products, and processed poultry also rose.
Meanwhile, beef and veal prices fell 4.3% as indexes for fresh and dry vegetables and for surgical and medical instruments also declined.
Core producer prices, which exclude the volatility from food and energy, rose 3.1% year over year and 0.7% on a monthly basis. Analysts were expecting those prices to increase by 2.7% and 0.2%, respectively.