Expensive energy: warning signal for inflation: producer prices jump dramatically in September

Producer prices are considered a leading indicator of future inflation. In September they rose by almost eleven percent, significantly more than economists expected. There is one main reason for this.

Berlin. Producer prices in industry in the euro zone rose massively in September. They climbed by 11.1 percent compared to the same month last year, as the Eurostat statistics office announced on Thursday. Economists polled by the Reuters news agency had expected a rise of 10.9 percent, following a revised 8.3 percent increase in August.

The main driver is high energy prices. In September, these rose by 30.8 percent in industry compared to the same month last year. At the same time, manufacturer prices for capital goods such as machines and systems climbed by 2.7 percent. There was an increase of 7.1 percent for intermediate goods. Compared to the previous month, manufacturers' prices rose by 2.5 percent in September, as economists had already expected.

The prices apply ex works, i.e. before the products are further processed or go on sale. They are considered early indicators of future inflation.

Expensive energy pushed inflation in the euro area to its highest level in more than three years in October. As a result, consumer prices rose by 4.0 percent, after 3.8 percent in September.

More: Inflation reaches four percent – ​​further interest rate hikes by the ECB are becoming more likely