The Producer Price Index (PPI) rose less than expected in March amid the spike in energy prices due to the war in Iran.<\/p>\n
The PPI increased 0.5% during the month, which was the same as February and lower than the 0.6% recorded in January, according to a Tuesday (April 14)\u00a0press release<\/a>\u00a0from the\u00a0Bureau of Labor Statistics<\/a> (BLS).<\/p>\n That figure was lower than expected, according to media reports. The Wall Street Journal\u00a0reported<\/a> Tuesday\u00a0that the analysts it polled had forecast a 1.1% increase. Similarly, Reuters\u00a0reported<\/a>\u00a0that the economist it polled had predicted a 1.1% rise. Reuters noted the forecast followed the BLS\u2019 previously reported 0.7% gain in February; the agency later revised that figure down to 0.5%.<\/p>\n According to the BLS press release, the March rise was driven by a 1.6% increase in prices for final demand goods, the largest rise since August 2023. Prices for final demand services did not change during March.<\/p>\n Most of the March advance in final demand goods was caused by an 8.5% jump in prices for final demand energy.<\/p>\n \u201cNearly half of the March advance in the index for final demand goods is attributable to a 15.7-percent rise in gasoline prices,\u201d the BLS said in the release. \u201cThe indexes for diesel fuel, jet fuel, home heating oil, meats and primary basic organic chemicals also increased.\u201d<\/p>\n Advertisement: Scroll to Continue<\/p>\n Both the WSJ and Reuters attributed these increases to the war in Iran.<\/p>\n The March increase drove the 12-month PPI to 4%, the highest level since the 4.7% recorded in February 2023, per the BLS release.<\/p>\n The PPI data was released on the same day that the National Federation of Independent Business (NFIB<\/a>) reported that the Iran war and the subsequent surge in\u00a0oil prices<\/a>\u00a0drove small business optimism below its 52-year average for the first time in a year in March.<\/p>\n