Producer Prices Give Back Nearly Half of January Gains

Bloomberg reported Wednesday that wholesale prices in the U.S. fell in February more than anticipated, led by a drop in fuel costs and signaling there are few inflation pressures building in the early stages of the economic recovery.

Prices paid to factories, farmers, and other producers fell the most since July, posting a 0.6% decrease, giving back nearly half the 1.4% increase recorded in January, according to figures from the Labor Department in Washington.

So-called core prices climbed 0.1%, excluding food and fuel.

Consensus estimates were for a 0.2% decrease in February producer prices, according to the median of 70 projections in a Bloomberg News survey.

The report confirms forecasts by Federal Reserve policy makers, who yesterday retained a pledge to keep the main interest rate near zero for an "extended period," and said "inflation is likely to be subdued for some time."