Supply Chain and Wholesale Inflation Hits 26.5%, Hottest Since 1974

The record-shattering 9.6 percent rise in producer prices indicates a startling level of inflation inflicting the U.S. economy.

Things are even worse once you get beyond the headlines. Further out on the supply chains, prices are rising even more rapidly, suggesting that product shortages and even more inflation are yet to come.

When you look at goods that are processed by U.S. manufacturers for sale to other businesses, such as an appliance manufacturer selling to a retailer or a software maker selling to an digital game store, prices are up by more than 26 percent.

The headline figure for the Producer Price Index records prices received by domestic businesses for “final demand” goods and services, those that are sold to households, governments, exported, or to businesses as capital investments. It is the category that most closely resembles the more-familiar Consumer Price Index, which measures prices paid by consumers and, unlike the PPI, includes imported goods.