U.S. wholesale inflation came in hot last month. Producer prices rose 6% from a year earlier, the most since December 2022, as the 10-week Iran war pushed up energy prices and put pressure on companies to pass along higher costs to consumers.
The Labor Department reported Wednesday that its producer price index—which tracks inflation before it hits consumers—shot up 1.4% in April, the biggest monthly gain since March 2022.
Energy prices climbed 7.8% from March to April and 22.7% from a year earlier. Gasoline soared 15.6% from March and diesel, the dominant fuel used in shipping, jumped 12.6%. Excluding volatile food and energy costs, so-called core producer prices rose 1% from March and 5.2% from April 2025.
All the numbers were much higher than economists had expected, altering the dynamic at the U.S. Federal Reserve and its fight against inflation.
“This report will set off alarm bells at the Fed and add fuel to the political conversation about affordability,″ Carl Weinberg, chief economist at High Frequency Economics, wrote in a commentary. ”The results are so far above expectations that this update will set off alarm bells in the financial markets, too.″
