Wholesale Inflation Less Food, Energy Surges

Washington, DC, May 20, 2008--Wholesale inflation fell in April after a huge increase in March although prices for a number of items spiked higher.

The Labor Department that Producer Price Index increased by 0.2 percent in April following a 1.1 percent jump in March. Excluding food and energy, prices rose by 0.4 percent.

The overall moderation in prices primarily reflected how the government adjusts its data to reflect seasonal changes.

The 0.2 percent increase for the PPI was lower than expectations but the 0.4 percent rise excluding food in energy was double what economists anticipated.

Food and energy have risen by 3 percent over the past 12 months, the fastest increase for a 12-month period since late 1991.

Energy prices fell by 0.2 percent in April after a 2.9 percent surge in March. The PPI report showed that gasoline costs fell by 4.6 percent. However, that decline reflected the government's seasonal adjustment methods. Since gasoline prices rose less than they usually do in April, that translated into a decline in the government's figures.