Inflation rises as unemployment falls

The Labor Department reported Thursday that wholesale prices increased 1 percent in July. This matches an increase in June, disappointing economists who hoped for a decrease as more sectors of the economy reopened. Back-to-back monthly increases have raised the producer price index by the biggest jump since January. Economists speculate the inflation results from rising service costs. For example, service for vehicles and auto parts surged by 11.2 percent in July alone.

What about jobs? The government also reported that the number of Americans filing jobless claims fell for the third week in a row from 387,000 to 375,000. The average rate before the pandemic was 220,000. The unemployment rate also sank slightly in July as states phased out COVID-19 unemployment benefit programs. Employers have posted 10 million available jobs as of Monday, and many are raising hourly rates to attract new workers, contributing to service cost increases.

Dig deeper: Listen to financial analyst David Bahnsen address price hikes on The World and Everything in It.