The cheapest place in the American economy last month was the start of the supply chain. Prices of unprocessed goods that businesses buy, the crude oil, ores, grain and scrap at the top of the pipeline, fell 3.1 per cent in October, the Bureau of Labor Statistics said on 13 November 2026. Everything downstream of them kept rising.
The Producer Price Index for final demand rose 0.3 per cent in October, seasonally adjusted, after a revised 1.4 per cent in September. Prices were 6.5 per cent higher than a year earlier, the largest 12-month increase since November 2022, when the figure was 7.4 per cent, the bureau said.
What rose and what fell in October?
Goods for final demand rose 0.5 per cent and services 0.2 per cent. Foods rose 1.3 per cent, and energy edged down 0.1 per cent. The index excluding foods, energy and trade services, which some forecasters treat as the core measure, rose 0.5 per cent, the same as in September.
The detail is mixed. Basic organic chemicals rose 3.9 per cent and led the goods index higher, while diesel fuel fell 7.9 per cent, according to the release. Among services, transportation and warehousing rose 2.0 per cent and accounted for about three-quarters of the services gain. Trade margins, the gap between what wholesalers and retailers pay and what they charge, fell 0.2 per cent.
September's first estimate, 1.3 per cent, was the largest monthly rise since 2022 when we reported it last month. The bureau has since revised it up to 1.4 per cent. October's figure is a slowdown from that, not a reversal.
How much of the energy shock is still in the pipeline?
A good deal, on our reading. The BLS sorts intermediate purchases into four stages, from stage 1, the goods and services furthest from the consumer, to stage 4, those that feed directly into final products. We pulled each from the BLS public database and computed the 12-month change in the unadjusted index.
| Index | Sep 2026, 12 months | Oct 2026, 12 months | Oct 2026, two years |
|---|---|---|---|
| Unprocessed goods for intermediate demand | 19.0% | 16.9% | 16.2% |
| Stage 1 intermediate demand | 13.5% | 13.9% | 17.8% |
| Stage 2 intermediate demand | 13.2% | 13.3% | 13.2% |
| Processed goods for intermediate demand | 13.9% | 14.6% | 18.1% |
| Stage 3 intermediate demand | 7.8% | 8.4% | 10.6% |
| Stage 4 intermediate demand | 7.9% | 8.0% | 11.5% |
| Final demand | 6.3% | 6.5% | 9.5% |
| Final demand goods | 9.5% | 10.2% | 13.2% |
| Final demand energy | 33.8% | 37.0% | 36.5% |
| Final demand less foods, energy and trade | 5.0% | 4.9% | 8.5% |
Every intermediate stage is rising faster than final demand. Stage 4, the last step before finished goods and services, is up 8.0 per cent in a year, against 6.5 per cent for final demand. That gap is the cost businesses have absorbed so far, or not yet passed on. The raw end has turned: unprocessed goods stood 19.0 per cent above their year-earlier level in September and 16.9 per cent in October. Processed goods, one step down, accelerated over the same month.
None of this flows straight into consumer prices. The consumer price index weights shelter and services heavily, and it reported no 12-month rate for October at all; we estimated it at about 4 per cent. But the stages above final demand tell you where pressure on margins sits.
Who is absorbing the fuel bill?
Airlines are a clear case. The producer price index for kerosene and jet fuel was 104 per cent higher in October than a year earlier, according to the BLS series. The index for scheduled passenger air transportation, which tracks what airlines charge, was up 16.5 per cent, by our calculation from its BLS series.
Fuel is only one of an airline's costs, so fares would not need to double to cover a doubled fuel bill. But a 16.5 per cent rise against a 104 per cent rise is a wide gap, and it fits what carriers told investors last month. Delta Air Lines said it would absorb $6 billion more for fuel this year. On the bureau's seasonally adjusted measure of airline passenger services, a separate index, prices declined in October, the release said.
What to watch
The BLS revises each month's index for four months, so September and October can still move. The November report is scheduled for 15 December 2026. The test is whether unprocessed goods keep falling. If they do, the stage 1 and stage 2 numbers should follow within a few months, and the case that producer inflation has peaked will rest on more than one month.
The monthly seasonally adjusted changes, the leading and lagging items and the stage-by-stage monthly changes are from the Bureau of Labor Statistics' Producer Price Index news release for October 2026, published on 13 November 2026. The 12-month and two-year changes are this publication's calculations from unadjusted index levels retrieved from the BLS public data API on 13 November 2026 (series WPUFD4, WPUFD41, WPUFD411, WPUFD412, WPUFD42, WPUFD422, WPUFD49116, WPUID51 to WPUID54, WPUID61 to WPUID63, WPU0572 and PCU481111481111). October 2026 indexes are preliminary. The analysis is our own.
Topics moneyinflationBureau of Labor StatisticsPPIenergy pricesjet fuelairlineseconomic data
