US producer prices surprised to the upside in February, with PPI rising 0.7% mom, more than double expectations of 0.3% mom. The annual rate accelerated to 3.4% yoy from 2.9% yoy, marking the strongest pace since February 2025 and reinforcing signs that upstream inflation pressures are re-emerging.
The strength was broad-based but led by services, which accounted for more than half of the monthly increase with a 0.5% rise. Goods prices also showed notable momentum, climbing 1.1% mom, suggesting that both supply-side and demand-driven factors are contributing to the pickup in producer inflation. The breadth of the increase points to a more persistent inflation impulse rather than a one-off rebound.
Underlying measures also remained firm. The index for final demand less foods, energy, and trade services rose 0.5% mom, extending a streak of ten consecutive monthly increases. The annual rate held elevated at 3.5% yoy.
