PPI Up 0.9% in December

Higher energy prices kept wholesale inflation humming in December.

The Labor Department said its producer price index rose 0.9% last month, more than twice the rate economists expected. The gauge, a key metric in the

Federal Reserve's

interest rate policy, rose by 0.7% in November.

Excluding food and energy, the so-called core PPI rose 0.1% in December, slightly below expectations.

Contributing to the 0.9% gain in the headline number was a 12.3% rise in gasoline prices, which helped pace a 3.1% increase in overall energy costs. Food prices rose 0.9% in December. Offsetting those was a 2.3% drop in raw materials prices.

In a separate report, the Commerce Department said retail sales rose 0.7% in December, below the 1% consensus forecast. Retail sales excluding autos rose 0.2% in December, also weaker than expected.