PPI exceeds market expectations

Surging energy prices pushed the producer price index up 0.9% in May, according to a Department of Labor report. The core producer price index, which excludes food and energy prices, rose 0.2%, marking the first increase in three months. Economists surveyed by Reuters and MarketWatch expected the headline index to rise 0.6%. Economists surveyed by Reuters expected the core reading to increase by 0.2%, while economists surveyed by MarketWatch expected the core number to increase 0.1%. The headline inflation number has risen 4.1% over the past 12 months, while the core inflation number is up 1.6% over the same period. Energy prices increased 4.1% during the month, marking the largest increased in six months. The increase followed a 3.4% increase in April. Wholesales gasoline prices increased 10.2% after rising 8.2% a month earlier. Wholesale food prices fell 0.2%, marking the first decline in seven months. The index had risen 0.4% in April.