Wholesale prices spiked at a near-record 11.3% annual rate, the Labor Department reported Thursday in another sign of out-of-control inflation that Republicans are blaming on overspending by President Biden and congressional Democrats. The annual percentage rate is much higher.
The Producer Price Index, a measure of prices paid by wholesalers, jumped 1.1% in June alone, more than analysts expected. The increase was largely due to high gas prices. Consumer prices also soared at a 9.1% annual rate, a 41-year high, stated the government report for June, released Wednesday.
Christopher Waller, a member of the Federal Reserve’s Board of Governors, said Thursday that he would be open to supporting a huge 1 percentage point increase in the Fed’s key short-term interest rate later this month if upcoming economic data points to robust consumer spending. Such an increase would further intensify the Fed’s fight against accelerating inflation but also heighten the risk that the central bank’s anti-inflationary policies would cause a recession. The Fed hasn’t raised its rate by 1 percentage point in one fell swoop for several decades.