US wholesale prices rose at their fastest annual rate in almost a year last month, according to fresh US government data published Thursday, on a rise in the cost of services.

The increase in the prices paid by producers is likely to weigh on the US Federal Reserve, which is grappling with an uptick in inflation in 2024 that threatens to undermine its largely successful battle against rising prices by hiking interest rates.

The producer price index (PPI) rose 0.2 percent in March, after rising by a higher-than-expected 0.6 percent a month earlier, the Labor Department said in a statement.

This was slightly below market expectations of a 0.3 percent monthly rise, according to Briefing.com.

But on an annual level, the index for final demand increased 2.1 percent for the 12 months ending in March -- its highest level since April 2023.

The PPI data, combined with the recent uptick in consumer inflation, "support a patient view on future monetary policy decisions," High-Frequency Economics chief US economist Rubeela Farooqi wrote in a note to clients.

Much of the March increase "is attributable to a 0.3-percent rise in prices for final demand services," the Labor Department said in a statement.

"A major factor in the March increase in prices for final demand services was the index for securities brokerage, dealing, investment advice, and related services, which rose 3.1 percent," the statement continued.

"In contrast, the index for final demand goods edged down 0.1 percent," it added.

Much of this was due to a decline in the energy index, which eased by 1.6 percent.