Producer prices post biggest drop in 7 months

The Labor Department on Wednesday said the index for prices paid at the farm and factory gate fell 0.6 percent, the largest decline since July, after increasing 1.4 percent in January.

Even excluding volatile energy and food costs, core producer prices rose just 0.1 percent last month.

"The bottom line is it looks like the price pressures are pretty moderate in terms of core producer prices right now. It doesn't suggest there is any kind of generalized inflationary pressures building up in the production pipeline," said Jonathan Basile, an economist at Credit Suisse in New York.

Analysts polled by Reuters had expected producer prices to fall 0.2 percent last month. Compared to February last year, producer prices increased 4.4 percent, but they slowed from a 4.6 percent year-on-year rise in January and were below market expectations for a 4.9 percent increase.

Read Full Article from Reuters

- Posted: 2010-03-17 11:10:02

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