The Labor Department reported that U.S. wholesale inflation saw an unexpected surge in July, according to the Associated Press. The news signals that President Donald Trump’s sweeping import taxes are driving costs upward.
The producer price index, which measures inflation before it hits consumers, rose 0.9% last month from June and 3.3% from one year earlier — both higher numbers than economics had anticipated.
The wholesale inflation report comes two days after the Labor Department said that consumer prices rose 2.7% last month from July 2024 — the same as the prior month and up from April’s 2.3% — a post-pandemic low.
The new numbers suggest that the impacts of Trump’s tariffs are being partially offset by slowing rent increases and cheaper gas, and many businesses are likely still absorbing much of the cost of the duties rather than passing them on to customers via higher prices.
