September Producer Prices Log Biggest Jump Since March 2022 as Energy Costs Surge

10:36 AM EDT, 10/15/2026 (MT Newswires) -- US producer prices jumped at the fastest pace in more than four years in September, driven by a surge in energy costs, likely adding more pressure on the Federal Reserve to further hike interest rates. The producer price index rose 1.3% on a seasonally adjusted basis last month following a 0.5% increase in August, the Bureau of Labor Statistics reported Thursday. The latest print marked the strongest pace of advance since March 2022, and is more than double the 0.6% climb projected in a Bloomberg-compiled survey. Wholesale prices of goods increased 2.6%, the fastest on record and showing a broad-based increase that is mainly attributable to energy's 10.8% jump, according to the BLS. The September PPI report showed that growth in the food index hit a seven-month high of 1.2%, following three straight months of declines. Prices of final demand services edged up 0.8% in September, the fastest rise in five months. Annually, the PPI climbed 6.3% on an unadjusted basis last month, the biggest jump since December 2022 and exceeding Wall Street's 5.4% growth estimate. The gain in August was revised to 5.6% from 5.4%. The latest producer inflation data followed Wednesday's report that showed US consumer prices accelerated last month, fueled by a surge in gasoline. The Fed raised interest rates unanimously on Sept. 16, its first hike in just over three years, to a range of 3.75% to 4% to cool stubborn inflation. Markets are pricing in a 29% probability that the US central bank will hike rates by another 25 basis points at its Oct. 27-28 meeting, with the remaining odds pointing to a pause, according to the CME FedWatch tool. The latest CME readings showed that an October Fed pause is "far from a sure thing," according to Oxford Lead US Economist Nancy Vanden Houten. "We expect the Federal Reserve to raise rates at their meeting at the end of the month, as stickier inflation and a solid labor market convince officials that they need to move sooner than markets anticipate," Vanden Houten said in a note e-mailed to MT Newswires. Minutes of the Fed policy committee's September meeting released earlier this month showed most Fed participants saw another hike as likely appropriate by year-end, though they pointed out that incoming data would be crucial.