The Economy

U.S. Producer Prices Increase 1%

Feb. 26, 2008

Rising food and energy costs to blame

U.S. inflation at the wholesale level surged a stronger-than-expected 1% in January due to rising food and energy prices, the Labor Department said on Feb. 26. The monthly rise in wholesale inflation was the strongest since November.

Food prices rose 1.7% last month while energy costs at the wholesale level increased 1.5%. The rise in food costs was the largest since October 2004.

The government snapshot showed the core PPI rate, which strips out volatile food and energy costs, increased 0.4% last month.

Headline inflation rebounded strongly after falling 0.3% in December while the core rate picked up following a rise of 0.2% in the last month of 2007.

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