Producer prices rise 8.3% per year, fifth consecutive record gain

Producer prices climbed at the fastest annual pace on record for the fifth consecutive month in August, as supply chain disruptions and material shortages continued to put upward pressure on costs.

The producer price index for final demand jumped 8.3% year-over-year, according to the Labor Ministry. The reading was higher than the 8.2% increase expected by analysts polled by Refinitiv and above the 7.8% impression recorded in July. The reading was the strongest since record keeping began in November 2010.

Producer prices rose 0.7% in August, slowing from the 1% increase in the previous month. Economists expected a gain of 0.6%.

Prices for final demand services rose 0.7% last month, the eighth consecutive monthly increase. More than 30% of the increase in the prices of final demand services is due to a 7.8% increase in the margins of the distribution of health, beauty and optical products.

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The prices of final demand goods rose 1% in August, after increasing 0.6% in July. Half of the gain was the result of a 2.9% increase in final demand food prices.

Basic producer prices, which exclude food and energy, climbed 6.7% a year and 0.6% in August. Analysts expected increases of 8.2% and 0.6%, respectively. The annual increase was the largest since the start of the data set in August 2014.