As the consumer price index continues to climb, indicating rising prices for energy, food and other consumer goods, wholesale prices also jumped in recent months. This November, wholesale prices increased by 9.6% since November 2020, the fastest increase on record, dating back to 2014, CNBC reported. These numbers are certainly something to consider as you plan around holiday shopping and spending.

                By                    Dawn Allcot

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MarketWatch noted that wholesale inflation could be rising at the “fastest pace in 40 years,” but the index was recalculated in 2014 using different methodology, making an apples-to-apples comparison impossible.

The wholesale price jump, which was faster than the projected 9.2% increase, followed an 8.6% rise in both September and October, according to U.S. News & World Report. Month-over-month, October saw an increase of 0.6%, in wholesale prices, measured by the “producer price index. November saw a 0.8% climb from the previous month, which exceeded economists’ expectations by 0.3%, MarketWatch reported.

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While the consumer price index (CPI) tracks the cost of goods and services for consumers, the PPI tracks wholesale pricing. While the CPI and PPI both track a broad range of categories, “core inflation” leaves out the volatile categories of food and energy. But even not accounting for these categories, which saw large jumps in both consumer and wholesale pricing, November’s year-over-year inflation rate stands at 9.5%.

MarketWatch reported that labor shortage and supply chain challenges have forced companies to raise prices in the hopes of reducing demand. Amid inflation concerns, the U.S. Federal Reserve intends to take action and has announced it will reveal plans on Wednesday, according to MarketWatch. The Fed said it will phase out stimulus sooner than it had expected. It is also expected to announce that it will accelerate the tapering of monthly bond purchases and potentially raise interest rates in mid-June.

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Commenting on the PPI increase, chief economist Stephen Stanley of Amherst Pierpont Securities told MarketWatch, “This is a testament to the fact that inflation continues to broaden out. The Fed should be very concerned.”

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