WASHINGTON (AP) — U.S. producer prices climbed last month at fastest pace since October 2018 as higher prices for services more than offset a drop in the cost of energy.
The Labor Department said Wednesday that its producer price index, which measures inflationary pressures before they reach the consumer, jumped 0.5% in January after rising 0.2% in December. The monthly increase was much bigger than economists expected.
Over the past year, wholesale prices are up 2.1%.
Excluding volatile food and energy prices, so-called core producer inflation rose 0.5% in January from December and 1.7% from January 2019.
The Labor Department said much of the 0.7% January increase in services prices came from higher markups for clothes, jewelry, shoes and accessories.
Energy prices dropped 0.7% last month, pulled down by a 1.5% decrease in gasoline prices.
Food prices rose 0.2% in January. But the price of chicken eggs plummeted 42.4% last month, most in records dating back to 1937.
Last week, the Labor Department reported that consumer prices blipped up 0.2% last month and rose 2.5% over the past year. The Federal Reserve aims to keep annual consumer inflation around 2%.