A report released by the Labor Department on Friday showed U.S. producer prices increased by slightly less than expected in the month of December.
The Labor Department said its producer price index for final demand rose by 0.3 percent in December after inching up by 0.1 percent in November. Economists had expected producer prices to rise by 0.4 percent.
The increase in producer prices largely reflected a spike in energy prices, which surged up by 5.5 percent in December after jumping by 1.2 percent in November.
Meanwhile, the report said food prices edged down by 0.1 percent in December after climbing by 0.5 percent in the previous month.
Excluding food and energy prices, core producer prices crept up by 0.1 percent in December, matching the uptick seen in the previous month. Core prices were expected to rise by 0.2 percent.
The modest increase in core prices came as prices for goods excluding food and energy rose by 0.5 percent, more than offsetting a 0.1 percent dip in prices for services.
Prices for trade services slid by 0.8 percent, while prices for transportation and warehousing services edged down by 0.1 percent and prices for other services crept up by 0.2 percent.
Compare to the same month a year ago, producer prices in December were up by 0.8 percent, unchanged from November. The annual rate of growth in core prices slowed to 1.2 percent from 1.4 percent.
“While some sectors have seen prices start to heat up, broader inflation measures continue to fall short of the Fed’s 2% goalpost as the economy entered the new year in a slump,” said Mahir Rasheed, Associate Economist at Oxford Economics.
The Labor Department released a separate report on Wednesday showing consumer prices increased in line with economist estimates in the month of December.
The report said the consumer price index rose by 0.4 percent in December after edging up by 0.2 percent in November. The price growth matched expectations.
The Labor Department said the advance by the consumer price index was driven by an 8.4 percent jump in gasoline prices, which accounted for more than 60 percent of the overall increase.
Excluding food and energy prices, the core consumer price index inched up by 0.1 percent in December after rising by 0.2 percent in November. The uptick in core prices also matched economist estimates.
The report said consumer prices in December were up by 1.4 percent compared to the same month a year ago, reflecting an acceleration from the 1.2 percent growth seen in November.
The annual rate of growth by core consumer prices in December was unchanged from the previous month at 1.6 percent.
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