Investing.com - US producer prices increased at a faster annual rate than anticipated in October, as the Federal Reserve assesses the outlook for inflation heading into its final policy meeting of the year.
Data from the Labor Department showed that the producer price index, a gauge of the amount producers receive for their goods and services, rose by 2.4% compared to a year ago, up from 1.9% in September and above economists' estimates of 2.3%.
For the month, the measure came in at 0.2%, accelerating from an upwardly-adjusted 0.1% in September and in line with projections.
Excluding more volatile items like food and fuel, the reading came in at 0.3% month-on-month, in line with estimates. Year-over-year, the so-called "core" index moved up by 3.1%, compared to expectations of 3.0%.
The numbers will likely be closely monitored by Fed officials ahead of the central bank's next interest rate decision in December. The producer price index feeds directly into the personal consumption expenditures price index, the Fed's preferred inflation metric, which is due out later this month.
Fed Chair Jerome Powell is due to speak at an event in Texas on Thursday, with his outlook on inflation and the broader economy set to be a major focus for markets.
Last week, the Fed cut borrowing costs by 25 basis points, noting that while inflation was "somewhat elevated" the risks to achieving stable price growth and a resilient jobs market were "roughly in balance."
Some economists have predicted that President-elect Donald Trump's policy proposals may place renewed upward pressure on prices -- and persuade the Fed to leave rates at an elevated level.
Media reports have also suggested that this uptick in volatility could exacerbate the possibility of a clash between the Fed and the Trump White House. Powell has flatly rejected notions that Trump could dismiss him from his post, telling reporters that he would not resign if asked to by the incoming administration.