Wholesale inflation is back on the energy channel. The Bureau of Labor Statistics released the August 2026 Producer Price Index this morning (Thursday, September 10, 8:30 a.m. ET). Final demand rose 0.4% month-over-month — matching the Reuters survey — after a revised +0.1% in July. Over 12 months, producer prices were up 5.4%, up from about 4.7% in July.

That is the first re-acceleration in the annual rate since the spring peak. It lands five days before the Fed’s September 15–16 meeting, and one day before August CPI.

Energy flipped from drag to driver

July’s flat headline was cheaper fuel pretending to be disinflation. August reversed it. Energy prices rose 4.2% on the month, ending two straight declines, as U.S.–Iran tanker attacks pushed crude back over $100. Goods jumped 1.1% after two monthly declines. Energy accounted for most of that goods advance. Foods edged up 0.1% after a 0.9% drop in July.

Services rose only 0.1%. The split is familiar: hot goods on energy, soft-ish services. That is the same pattern as March, just later in the war.

Core did not get a holiday

Bloomberg’s read of PPI excluding food and energy was +0.2% on the month. Coverage of the BLS tables put PPI excluding foods, energy, and trade services around +0.3% MoM and +4.7% over the year. Headline energy explains why 5.4% y/y looks worse than July. It does not mean the rest of the pipeline is at 2%.

What this means at the pump — not just the barrel

You do not buy the PPI. You buy gallons. The same week this report covers, AAA diesel set a new national record near $5.98 and California’s average hit $7.91 — 70% above January at the pump. That is the household translation of “wholesale energy +4.2%.” Full pump math: California diesel record $7.91.

PPI is the lagging confirmation of what truckers already paid in August. It is also the leading tell for freight surcharges and grocery pass-through in the next CPI prints.

For the Fed

A 0.4% month that matches forecast will not, by itself, settle a hike debate. A 5.4% annual wholesale rate, with energy turning back up, is not the print doves wanted into a projections meeting. CPI tomorrow is the one that fills the household basket. This one filled the warehouse.

PPI series: February · March · August. Consumer side: CPI tracker.

Sources: Bureau of Labor Statistics, Producer Price Indexes — August 2026 (released September 10, 2026); Reuters (final demand +0.4% MoM, +5.4% y/y; energy +4.2%; goods +1.1%; services +0.1%); CNN; Bloomberg (core ex food and energy +0.2% MoM). Related: California diesel $7.91.