The numbers: U.S. wholesale prices surged again in June, signaling that a recent bout of high inflation is likely to last at least through the summer.

The producer price index jumped 1% last month, the government said Wednesday. Economists polled by The Wall Street Journal had forecast a 0.6% increase.

The pace of wholesale inflation over the past 12 months moved to 7.3% from 6.6% in May. That’s the highest level since the index was overhauled in 2009, and likely one of the highest readings since the early 1980s.

Read: Fed admits inflation rose much higher than expected, but it still insists price increases are temporary

The rate of inflation was still quite low as recently as the end of last year, but it’s risen sharply in 2021 as a fully reopened economy unleashed a wave of pentup demand that businesses have been unable to satisfy.

Put another way there’s too much money chasing too few goods — a classic definition of inflation.

Read: The cost of living posts biggest surge since 2008, CPI shows, as inflation spreads through economy

Big picture: Prices of many goods and services have risen rapidly this year. That much is clear. What’s less certain is how quickly and how much inflation will slow?

The Federal Reserve has insisted for months that inflation will eventually taper off toward its 2% goal, perhaps by early next year. Chairman Jerome Powell reiterated that view on Wednesday in testimony to Congress.

Read: Inflation will moderate, Powell says in prepared testimony to Congress

Right now consumer prices are rising at a 5.4% yearly pace — the fastest increase since 2008.

There are some signs inflation will ease.

Used-car prices, a huge contributor to high inflation, are set to start declining. And the cost of both shelter and medical care, the two biggest expenses for most households, have been fairly tame this year.

It’s small consolation to consumers, though. Gas prices have surged and the cost of food is also going up. That will pinch household income for the foreseeable future.

Read: Why used-car prices are driving U.S. inflation higher — and why it won’t last

Key details: About 60% of the increase in wholesale inflation last month reflected the higher cost of services, a volatile category that can swing sharply from month to month.

Still, the cost of most services have soared over the past several months as vaccinated Americans go out to eat, travel, fly, rent vacation homes and do all the things they couldn’t do during the pandemic. These prices had tumbled early in the pandemic.

The cost of goods also rose sharply last month. Wholesale food prices increased 0.8% in June, led by higher costs of beef, pork and chicken.

Higher prices of corn and other farm goods are expected to raise the cost of groceries in the coming months.

The cost of energy also jumped 2.1% in June.

The core rate of wholesale inflation, meanwhile, increased 0.5% last month. The core rate is a less volatile measure that strips out food, energy and trade margins. It tends to give a more accurate picture of inflationary trends.

The increase in the core rate over the past 12 months edged up to 5.5% from 5.3%. That’s the largest advance since the government first began reporting it in 2014.

The cost of raw and partly finished goods in the earlier stages of production also rose sharply again.

Higher wholesale prices, it should be kept in mind, don’t always translate into higher inflation. Companies raise or lower prices for any number of reasons.

Market reaction: The Dow Jones Industrial Average
DJIA,
-0.31%

and S&P 500
SPX,
-0.35%

were set to open modestly higher in Wednesday trades. Stocks fell on Tuesday after the CPI showed another big increase in prices in June.

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