Wholesale prices rise 0.3% in October as annual inflation hits 6.5%, highest since 2022
U.S. wholesale prices rose 0.3% in October, less than the 0.4% forecast, but the annual rate accelerated to 6.5%, the highest since November 2022, keeping the Federal Reserve on course for a December rate hike.
A cooler month, a hotter year
The producer price index rose a seasonally adjusted 0.3% in October, the Bureau of Labor Statistics reported Friday, below the 0.4% increase expected in a Dow Jones consensus. Stripping out food and energy, core PPI also rose 0.3%, meeting expectations.
On an annual basis, headline PPI accelerated to 6.5%, up from 6.3% in September and the highest annual rate since November 2022. The core rate over 12 months eased slightly to 4.9% from 5.0% in September, MarketWatch reported, still far above the Federal Reserve's 2% goal.
Where prices rose
Goods prices increased 0.5% in October, with more than 60% of that move driven by goods excluding food and energy, which actually fell 0.1%. On an annual basis the goods index jumped 10.2%, its biggest 12-month surge since October 2022.
Final demand services prices rose 0.2%, most of it linked to transportation and warehousing, including a 3.9% gain in truck transportation of freight. Stripping out food, energy and trade services, PPI rose 0.5% in October. Prices for intermediate processed goods soared 14.6% from October 2025, the biggest annual gain since July 2022, while intermediate services prices rose 6.9%, the most since November 2022.
- PPI, October (monthly)+0.3%
- Dow Jones forecast+0.4%
- PPI, annual rate6.5%
- Core PPI, 12 months4.9%
- Goods index, annual+10.2%
- Next Fed meetingDecember 8-9
The Fed stays on course for December
The report lands weeks before the Federal Reserve's next policy meeting on December 8-9. Markets fully price in a quarter percentage point increase in the central bank's key overnight borrowing rate, with slight odds the Federal Open Market Committee opts for a half-point hike. Stock market futures added to gains after the release, while Treasury yields were mixed.
The figures follow a hotter-than-expected consumer price report earlier in the week: headline CPI rose 0.4% in October and core CPI 0.3%, each 0.1 percentage point above expectations. Chicago Fed President Austan Goolsbee said the Fed has been above its 2% goal for almost six years, and that progress has stalled. Chris Zaccarelli, chief investment officer at Northlight Asset Management, said the data was unlikely to change the Fed's approach in December.
