by Sundance at The Conservative Treehouse
Here we go folks. Jumpin’ ju-ju-bones, the first wave of producer driven inflation has just been quantified. The economic analysts are shocked, stunned, flabbergasted and surprised, because the January single month wholesale inflation of 1.0% is double what they expected.
The “producer price index” is essentially the tracking of wholesale prices at three stages: Origination (commodity), Intermediate (processing), and then Final (to wholesale). Today, the Bureau of Labor and Statistics (BLS) released January price data [Available Here] showing a dramatic 9.7% increase year-over-year in Final Demand products at the wholesale level.
Check out the single month wholesale price increases in these categories [Table 2]: Beef jumped 6.5% in January (43.9% for year). Gasoline jumped 1.9% in January, (53.9% for year). Diesel fuel jumped 9.4% in January (56.5% for year). Cooking oil 4.7% in January (36.4% for year). Home heating oil jumped 7.3% in January (47.4% for year). Pasta jumped 3.0% in January (16.2% for year). Tires jumped 4.6% in January (9.0% for year). Wholesale cleaning supplies jumped 3.8% in January (34.9% for year).
Unfortunately, there is nothing upstream in the supply chain and manufacturing pipeline to suggest that higher prices at the retail level are not coming. The price of raw materials, and the wholesale energy costs to process those materials into finished goods, are still rising…
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