December U.S. wholesale prices drop, giving hope of holding off inflation

  • Article by: DEE DePASS
  • Star Tribune
  • January 15, 2013 - 8:17 AM

U.S. wholesale prices fell for a third month in December as food costs dropped, giving economists hope that the threat of inflation would be held at bay.

December's producer price index slid 0.2 percent after falling 0.8 percent in November, according to figures released Tuesday by the U.S. Department of Labor.

Economists had forecast a decline of 0.1 percent, according to the median of 77 estimates in a Bloomberg News survey.

For the full 2012 year, prices paid by companies climbed 1.3 percent, which was the smallest increase since a drop in 2008. To compare, there was an average 3.4 percent gain over the prior decade, Bloomberg reported.

Demand that cooled globally last year from Europe to China helped check input costs for producers.

The reduced inflationary pressures mean Federal Reserve policymakers can keep adding stimulus to spur growth and employment without triggering a surge in prices.

This report contains information from Bloomberg News. Dee DePass • 612-673-7725

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