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Wholesale prices climbed in October as inflation continued to pressure the economy and complicate the Federal Reserve’s coming interest rate decision. Although the monthly increase was smaller than forecast, the annual rate reached its highest level in nearly four years.

The producer price index rose a seasonally adjusted 0.3% for the month, according to a Friday report from the Bureau of Labor Statistics. The Dow Jones consensus had called for a 0.4% increase.

The index measures the prices domestic producers receive for their products before those goods reach consumers. Excluding food and energy, core PPI also advanced 0.3%, matching expectations.

On an annual basis, headline PPI accelerated to 6.5%. That represented an increase of 0.2 percentage point and marked the highest annual rate since November 2022.

The inflation report arrived only a few weeks before the Federal Reserve’s next policy meeting, scheduled for Dec. 8 and 9. Markets were fully pricing in a quarter percentage point increase in the central bank’s key overnight borrowing rate.

Markets also assigned slight odds that the Federal Open Market Committee could choose a half point increase. Stock market futures added to gains after the wholesale inflation report was released, while Treasury yields delivered a mixed response.

The producer price data followed a hotter than expected consumer inflation report earlier in the week. The headline consumer price index increased 0.4% in October, while the core reading rose 0.3%.

Both consumer inflation readings were 0.1 percentage point above expectations. Because of the government shutdown in October 2025, the Bureau of Labor Statistics could not collect some data and did not publish a 12 month inflation figure for CPI.

Even without that annual CPI figure, the reported numbers showed that the Federal Reserve remained well away from its 2% inflation goal. The wholesale data provided some signs of improvement, but inflation remained elevated.

“Today’s PPI data – which shows some signs of improving, albeit still too-high – is unlikely to change the Fed’s approach in December because the CPI data was already outside their comfort zone,” said Chris Zaccarelli, chief investment officer for Northlight Asset Management.

Policymakers have started worrying that inflation tied to the Iran war and higher fuel prices, along with President Donald Trump’s tariffs, is spreading through the economy. The Fed generally would look through such pressures as temporary, but broad inflation could indicate that price increases are becoming more entrenched.

“We’ve had some signs of trouble now for several months in a row,” Chicago Fed President Austan Goolsbee said in a CNBC interview Friday. He pointed to inflation in categories not driven by oil prices or tariffs as evidence of stalled progress and, in some cases, movement in the wrong direction.

A narrower PPI measure that excludes food, energy and trade services increased 0.5% in October. That reading added another sign of price pressure beyond the most volatile portions of the index.

Goods prices increased 0.5% during October, with more than 60% of that movement driven by goods excluding food and energy. On an annual basis, the goods index surged 10.2%, its largest 12 month increase since October 2022.

Final demand services prices rose 0.2%, with most of the increase linked to transportation and warehousing services. Within that category, truck transportation of freight recorded a 3.9% gain.

Other parts of the producer price report also registered multiyear increases. Prices for intermediate processed goods soared 14.6% from October 2025, the largest annual gain since July 2022, while intermediate services prices climbed 6.9%, the most since November 2022.

“We’ve been above 2% for almost six years, and while it sometimes we were making progress, lately we’re not making any progress, and if anything, it’s going the wrong way,” Goolsbee said. “Inflation is rising; it’s it’s proved far more persistent than we predicted at the beginning from the supply shocks.”

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.