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US producer prices climbed more than forecast in Feb
[WASHINGTON] US producer prices rose more than forecast in February, while costs increased from a year earlier by the most since March 2012, signaling inflation is picking up, a Labor Department report showed Tuesday in Washington.
Key Points Producer-price index climbed 0.3 per cent from January (forecast was for 0.1 percent gain) after 0.6 per cent jump that was the biggest since September 2012 Over 80 per cent of the advance due to 0.4 per cent increase in services prices PPI increased 2.2 per cent from February 2016 (estimate was 1.9 per cent) following a 1.6 per cent rise in the previous 12-month period Excluding food and energy, wholesale prices rose 0.3 per cent from the previous month (forecast was 0.2 per cent) and rose 1.5 per cent from February 2016
Increased global demand is helping drive up costs of some commodities and allowing price pressures to gradually build in the production pipeline. Higher wholesale costs can lead broader inflation toward the Federal Reserve's goal depending on how successful producers are in eventually pushing their costs through to American consumers. Fed policy makers, meeting Tuesday and Wednesday, are projected to raise interest rates as inflation moves higher and the job market continues to improve.
The Details Energy prices rose 0.6 per cent from the prior month; food costs increased 0.3 per cent PPI goods prices advanced 0.3 per cent, the sixth straight rise and led by energy, after a 1 percent jump Almost 70 per cent of rise in goods prices attributable to electric power, which jumped 1.6 per cent Excluding volatile components such as food, energy and trade services, producer costs picked up 0.3 per cent from previous month (forecast was 0.2 per cent) and 1.8 per cent from a year earlier Gain in services costs was largest since June of last year and led by a 4.3 per cent increase in traveler accommodation services