Wholesale prices rose more than expected in April, according to new data released on Tuesday. However, Federal Reserve Chairman Jerome Powell claimed the announcement was “mixed” when analyzing the March producer price index revision.
“The producer price index was released just a few hours ago, and I would say it’s actually quite mixed,” Powell said during a panel discussion in Amsterdam. “The headline number was higher, but that was a backwards adjustment.”
He added: “I wouldn’t call it hot. I think it’s kind of a mixture.”
The latest release from the Producer Price Index, which measures the prices producers receive for the goods they produce, showed wholesale prices rose 0.5% in April from the previous month, beating the consensus estimate of 0.3%.
The “core” PPI, which excludes the volatile food and energy sectors, also rose 0.5%, beating expectations for a 0.2% rise. Additionally, the month-on-month price increase rate for March was revised downward from an initial increase of 0.2% to a decrease of 0.1%.
Powell spoke broadly about inflation on Tuesday, saying he wasn’t as confident as he was at the beginning of the year that inflation would continue to cool and that the central bank needed to be patient before cutting interest rates.
“I didn’t expect it to be a smooth road, but [inflation readings] I think it was higher than anyone expected,” Powell said. “What this tells us is that we need to be patient and make restrictive policies work.”
