Wholesale Prices Down Again

Washington, DC, June 16, 2010--Wholesale prices fell for a second straight month in May, reflecting big declines in the cost of energy and food.

The Labor Department said Wednesday that wholesale prices dropped 0.3 percent in May following a 0.1 percent decline in April. Core inflation, which excludes energy and food, rose 0.2 percent. Core prices are up just 1.3 percent over the past 12 months.

Many economists believe the Fed will not start raising rates until sometime next year, believing that the severe recession of 2007-2008 will keep inflation a no-show for the rest of this year.

In May, energy prices fell 1.5 percent, the biggest drop since a 2.2 percent decline in February. Gasoline prices were down 7 percent while home heating oil fell 7.4 percent and residential natural gas was down 1.1 percent.