Wholesale Inflation Surged By 11.2% As Consumer Prices Hit 41-Year High

Consumer prices climbed to a 41-year high as wholesale inflation increased by 11.2% over the past year. The Labor Department said that the producer price index, which measures the prices paid by wholesalers, increased by 1.4% from February to March.

Economists predicted wholesale inflation would be up by 10.6% over the past year and that the monthly increase would be just 1.1%.

The main driver of the record increase was the rising cost of energy, which jumped by 5.7%, amid the ongoing war between Russia and Ukraine.

The cost of goods rose by 2.3%, while the prices of services increased by 0.9% in March. Over the past year, the costs for goods have increased by 8.5%, the largest increase since 1981.

Fresh produce saw the biggest jump, with prices increasing by a staggering 81.5% over the past 12 months.

While the Federal Reserve hopes to temper the rising inflation by hiking interest rates and trimming down its assets portfolio, many economists are concerned the aggressive moves may trigger a recession. The Fed increased interest rates by 0.25 percentage points in March and hinted that a half-point increase is on the table when policymakers meet again in May.