Almost 90 percent of the gain came from the final demand of energy costs as prices for oil, natural gas and other products soared around 10 percent during the month.
The core PPI rose 6.4 percent on a 12-month basis, excluding energy, food and trade services. This was down from the 6.8 percent gain in May.
The release comes a day after the BLS reported that the consumer price index (CPI) surged 9.1 percent, which is its highest 12-month gain since November 1981.
In a separate report, the Department of Labor said that weekly jobless claims rose to 244,000 for the week ending on July 9, which is the highest number since November 20 last year. But continuing claims, which are reported a week behind the headline number, fell by 41,000 to 1.33 million.
There were some optimistic signs in the PPI report. Chicken eggs, for example, went down 30.2 percent, while iron and steel scrap prices were 10.4 percent lower.
However, Federal Reserve officials are expected to keep pressing forward on interest rate hikes to bring down inflation more, and closer to their longer-run two percent goal. (Related: Still no end in sight: Food inflation soars to highest level in 42 years.)
Following the CPI release, traders give an 86 percent chance that the central bank will raise its benchmark interest rates by a full percentage point, which is the largest increase since the early 1980s.
High inflation raises risk of economic downturn
The high inflation has eroded incomes and intensified price pressures on both large and small companies, all of which raised the risk of an economic downturn as a result of higher borrowing costs.
Moreover, it diminished the public's approval of President Joe Biden, dimming the Democratic Party's prospects for the November congressional elections.
The Fed has also embarked on an aggressive series of price hikes that are intended to taper high inflation without causing a recession.
Economists have held out hope that inflation might be reaching a short-term peak as gas prices have already been falling and shipping costs and commodity prices have been moderated. Pay increases have also slowed and surveys showed that American expectations for long-term inflation have eased, which is a trend that points to more moderate price increases ahead. (Related: Natural gas prices worldwide soar to record highs.)
But last week’s reports showing persistently high consumer and wholesale inflation pressures indicate that the Fed will remain under pressure to continue raising rates sharply in the coming months.
"Despite a modest improvement in supply conditions, price pressures will remain uncomfortable in the near term and bolster the Fed's resolve to prevent inflation from becoming entrenched in the economy," said Mahir Rasheed, U.S. economist at Oxford Economics.
Watch the video below for more commentary about the state of the nation's economy from Tucker Carlson.
This video is from the Rick Langley channel on Brighteon.com.
More related stories:
Survey: Americans have changed their spending and eating habits to cope with Biden’s inflation.
Economist: America about to enter next stage of inflation, which will be so much worse.
Sen. Cotton says gas prices will continue to rise, calls for deregulation of energy production in US.
Gas rationing, food vouchers and hunger are now being normalized for the war phase of the plandemic.
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