U.S. producer prices rise by 1.1% month-on-month in May in World Economy News 12/06/2026 U.S. producer price growth rose by 1.1% on a monthly basis in May, equaling April’s downwardly-revised pace, as investors hunt for insight into the inflationary effects of an energy price spike caused by the Iran war. Economists had anticipated that the Labor Department’s month-on-month producer price index for final demand on Thursday would slow to 0.7%. Much of the uptick was fueled by a 2.8% jump in the index for final demand goods, the largest such increase the Labor Department began calculating PPI in December 2009. Of that broad-based advance, 80% can be traced back to a 10.7% spike in prices for final demand energy. Gasoline prices, in particular, surged by 23.4%, while the costs of key inputs for some manufacturers — such as diesel fuel, jet fuel, plastic resins, industrial chemicals, and natural gas liquids — also rose. The index for final demand services, meanwhile, eased to 0.3% from 0.7% in April, following a decrease in margins received by wholesalers and retailers. But costs increased for airline passenger services and portfolio management, two key components in the personal consumption expenditures price index, an inflation gauge closely followed by the Federal Reserve. In the twelve months to May, PPI rose 6.5%, compared to 5.7% in the preceding month and expectations of 6.4%. Stripping out volatile items like food and fuel, so-called “core” PPI stood at 0.4% month-on-month and 4.9% year-on-year, both cooler than projected. Markets have been keeping close tabs on any signs of energy-induced inflation in the U.S., with investors now betting that the Federal Reserve may hike interest rates to put a lid on price pressures before the end of 2026. Separate data on Wednesday showed that consumer prices gained at their fastest pace in years last month, driven largely by a spike in gasoline pump costs. “The May PPI data brought worse news for the Fed than was the case wi