US wholesale prices ticked up 0.1 percent in February
WASHINGTON (AP) — U.S. wholesale prices barely increased last month after falling for three straight months, a sign there is little inflation pressure in the economy.
The producer price index — which measures price changes before they reach the consumer — rose 0.1 percent in February, the Labor Department said Wednesday. It slipped 0.1 percent in January. Excluding volatile food and energy costs, core producer prices also rose 0.1 percent. Wholesale prices increased 1.9 percent from a year earlier, and core prices rose 2.5 percent.
Despite an unemployment rate near a five-decade low and faster wage growth, inflation is tame. The consumer price index, released Tuesday, increased just 1.5 percent in February from a year ago. Mild inflation is a major reason the Federal Reserve has paused its interest rate hikes.
The Fed lifted rates four times last year, but Fed Chairman Jerome Powell has since emphasized that the central bank sees little need to lift rates now and will monitor incoming data for any signs of rising inflation.
Last month’s increase was driven by more expensive gas, pricier plane tickets and a jump in hotel costs, which rose by the most in nearly a decade of record-keeping.
Food costs fell, led by a 12.8 percent drop in prices of fresh and dry vegetables, and cheaper frozen foods and chickens.
Wholesale price increases have slowed in the past year. Twelve months ago, the producer price index rose 2.8 percent from a year earlier, nearly a full percentage point higher than last month’s pace.