Hold off on those rate-cut predictions.
The U.S. government said Tuesday that the producer price index, or prices at the wholesale level, jumped by the biggest amount in more than 30 years in November, propelled by a surge in energy prices.
Excluding the often volatile food and energy sectors, prices rose 1.1 percent last month. The surge comes on the heels of a decline in both October and September, but nevertheless will raise red flags at the Federal Reserve, where Chairman Ben Bernanke recently said the Fed was more concerned about inflation than many observers had perceived.
The jump in the PPI was led by a 17.9 percent surge in gas prices, and home heating oil and other fuels rose as well.
The PPI report was particularly surprising given last week's reading on consumer prices, which continued to show scant signs of inflation at the retail level.
Separately, a reading on new home construction showed activity increased by 6.7 percent in November, while permits for new home construction fell.
