Producer prices jump at quickest pace in 11 years

More signs the U.S. economy is running hot and could stay that way for a while. The Labor Department reported Tuesday that prices at the wholesale level rose in November at their fastest annual pace in 11 years.

Producer prices jumped 0.8% last month as supply constraints persisted. That’s an acceleration from October, and that was much higher than economists had expected. On an annual basis, wholesale prices shot up 9.6%

That’s even higher than the 6.4% jump in prices at the consumer level reported last week – the highest in nearly four decades.

Driving the producer price index higher: both goods and services. Prices for iron and steel scrap, gas and food rose, as did portfolio management, lodging, air fares and freight and mail transportation.

The strong price pressures amid a tightening labor market will likely push the Federal Reserve to say it’ll speed up the tapering of its massive bond purchases when it concludes its two-day meeting on Wednesday. That could make room for interest rates to rise sooner than anticipated.

Anxious investors sent stocks lower at the market open Tuesday.

Soaring inflation also complicates President Joe Biden’s economic agenda. His massive social policy and climate package is still stuck in Congress.