Prices one step short of the retail level rose in February for the second straight month.
Figures released by the Labor Department show the Producer Price Index (PPI) for finished goods was up 0.7% last month following an advance of 0.2% in January. Economists at Briefing.com had projected a rise of 0.8%. For the 12 months ended in February, the PPI is up 1.7 percent -- the largest 12-month increase since a 2.3-percent rise in October 2012.
Energy leads the way
The February advance in the PPI was led by energy prices, which rose 3.0 percent%. The cost of gasoline accounted for most of this advance, jumping 7.2%. Rising prices for home heating oil and diesel fuel also were factors.
Prices for consumer foods helped take the sting out of the overall increase, falling 0.5% after rising 0.7% in January. Fresh and dry vegetable costs accounted for most of the decrease, falling 18.0%.
When the volatile food and energy sectors are stripped out, the “cor rate” of inflation was up 0.2% -- on target with economists' forecasts and the fourth consecutive advance. About 20% percent of the February increase can be traced to prices for pharmaceutical preparations, which were up 0.2%. An advance in the cost of plastic products also contributed to higher a higher core rate.
Weekly jobless claims
Separately the government reports the number of people standing in the unemployment line during the week ending March 9 fell by 10,000 from the previous week as 332,000 people filed initial claims for jobless benefits. Economists at Briefing.com were calling for increase to 350,000. The previous week's figure was revised upward by 2000.
The 4-week moving average, which is less volatile and considered a more accurate gauge of the labor market, was 346,750 -- down 2,750 from the previous week's revised average of 349,500.