U.S. producer prices surged 6.5% in May from a year earlier, the fastest annual increase since November 2022, driven by a 23% monthly jump in wholesale gasoline prices after the Iran war disrupted oil supplies.
- The Producer Price Index rose 1.1% from April, matching the previous month's gain. - Core wholesale prices, excluding food and energy, increased 0.4% monthly and 4.9% annually.
- Consumer prices also rose 4.2% in May from a year ago, with gasoline up nearly 41% and airfares up 27%. - The Federal Reserve is expected to hold rates steady next week but may raise them later this year to combat inflation.
The energy crisis began after the U.S. and Israel attacked Iran on Feb.
28, leading to the closure of the Strait of Hormuz and the largest oil supply disruption in history. S&P Global Energy warned that U.S.
crude inventories are declining and could enter a "danger zone" if draws continue.