Wholesale Prices Rise in November
NEW YORK (
) -- Prices at the wholesale level rose more than expected in November, the Labor Department said early Tuesday.
The Producer Price Index for finished goods, or PPI, increased 0.8%, after rising 0.4% in October. Economists were expecting PPI to rise by 0.5%, according to consensus estimates from
Briefing.com
.
The core rate of inflation, which excludes volatile food and energy prices, rose 0.3% after declining 0.6%. That was slightly higher than expectations of 0.2%. The increase was led by a 1.7% rise in prices of passenger cars.
Prices for finished energy goods rose 2.1%. More than 75% of the November rise can be attributed to the index for gasoline, which moved up 4.3% in November after rising 9.8% in the prior month.
In November, prices for finished consumer foods rose 1 percent after dipping in the previous month.
On an unadjusted basis, prices for finished goods rose 3.5 percent for the 12 months ended November 2010, their smallest 12-month increase since a 3.1-percent advance in August.
The
Federal Reserve
will hold its monthly policy meeting on Tuesday afternoon. Few analysts expect the Fed to announce major changes to its quantitative easing program in the final month of the year. But the market will be watching for the central bank's outlook on growth and inflation.
Recent economic data has encouraged hopes of a speedier recovery. That could lead to a pickup in inflation. The Fed has maintained that inflation levels are too low and below its mandate for price stability. The central bank would prefer a rate closer to 2%.
-- Written by Shanthi Bharatwaj in New York
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