US Wholesale Prices Fall Unexpectedly

Posted January 18th, 2012 at 10:25 am (UTC-5)
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The U.S. says the price for wholesale goods fell last month, a sign that inflation remains tame.

The Labor Department said Wednesday that wholesale prices — the price manufacturers pay for goods and materials before they reach consumers — declined by one-tenth of one percent in December. Economists polled by news agencies had expected a one-tenth of a percent gain.

Excluding the volatile food and energy categories, the closely watched core index rose three-tenths of one percent, the largest increase since July. The Labor Department said about 30 percent of that gain was due to an increase in prices for light trucks.

Lower wholesale costs mean manufacturers and retailers face less pressure to raise consumer prices.

The nation’s central bank, the U.S. Federal Reserve, has forecast consumer price inflation will fall this year. Lower inflation gives the Fed more flexibility to take steps to boost the economy.