US producer prices up 1.4% in May

US producer prices jumped by more than expected in May amid soaring fuel and food prices which are threatening to accelerate the pace of inflation, reported The BBC.

Prices climbed by 1.4%, marking the biggest gain since November 2007, according to statistics from the US Labour Department. Analysts had forecast a rise in producer prices of about 1%.

Core producer prices - excluding fuel and food - increased by 0.2%, in line with analysts' forecasts.

The figures show producers are now paying 7.2% more than they were in May 2007. It is the eighth consecutive month prices rose more than 6% on a yearly basis. The new figures add to worries that producers will soon be forced to raise prices to limit the impact of spiralling fuel and food prices.

Analysts said that firms could only pass on so much to the consumer before having a negative impact on company profits.